By: Harris S.B. No. 1467
A BILL TO BE ENTITLED
AN ACT
1-1 relating to a nonsubstantive revision of statutes relating to the
1-2 Texas Department of Insurance, the business of insurance, and
1-3 certain related businesses, including conforming amendments,
1-4 repeals, and penalties.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. ADOPTION OF TITLE. The Insurance Code is amended
1-7 by adding Title 2 to read as follows:
1-8 TITLE 2. TEXAS DEPARTMENT OF INSURANCE
1-9 SUBTITLE A. ADMINISTRATION OF THE
1-10 TEXAS DEPARTMENT OF INSURANCE
1-11 CHAPTER 30. GENERAL PROVISIONS
1-12 CHAPTER 31. ORGANIZATION OF DEPARTMENT
1-13 CHAPTER 32. ADMINISTRATIVE POWERS AND DUTIES
1-14 CHAPTER 33. STANDARDS OF CONDUCT
1-15 CHAPTER 34. IMMUNITY FROM LIABILITY
1-16 (Chapter 35 reserved for expansion
1-17 CHAPTER 36. DEPARTMENT RULES AND PROCEDURES
1-18 CHAPTER 37. RATEMAKING AND POLICY FORM PROCEEDINGS
1-19 CHAPTER 38. DATA COLLECTION AND REPORTS
1-20 CHAPTER 39. PUBLIC ACCESS
1-21 CHAPTER 40. DUTIES OF STATE OFFICE OF ADMINISTRATIVE HEARINGS
1-22 AND COMMISSIONER IN CERTAIN PROCEEDINGS; RATE
1-23 SETTING PROCEEDINGS
1-24 (Chapters 41 to 80 reserved for expansion
2-1 SUBTITLE B. DISCIPLINE AND ENFORCEMENT
2-2 CHAPTER 81. GENERAL PROVISIONS REGARDING DISCIPLINE AND
2-3 ENFORCEMENT
2-4 CHAPTER 82. SANCTIONS
2-5 CHAPTER 83. EMERGENCY CEASE AND DESIST ORDERS
2-6 CHAPTER 84. ADMINISTRATIVE PENALTIES
2-7 CHAPTER 85. GENERAL CRIMINAL ENFORCEMENT
2-8 (Chapters 86 to 100 reserved for expansion
2-9 CHAPTER 101. UNAUTHORIZED INSURANCE
2-10 CHAPTER 102. CHARITABLE GIFT ANNUITIES
2-11 TITLE 2. TEXAS DEPARTMENT OF INSURANCE
2-12 SUBTITLE A. ADMINISTRATION OF THE TEXAS
2-13 DEPARTMENT OF INSURANCE
2-14 CHAPTER 30. GENERAL PROVISIONS
2-15 Sec. 30.001. PURPOSE OF TITLE
2-16 Sec. 30.002. CONSTRUCTION OF TITLE
2-17 Sec. 30.003. REFERENCE IN LAW TO STATUTE REVISED BY TITLE
2-18 CHAPTER 30. GENERAL PROVISIONS
2-19 Sec. 30.001. PURPOSE OF TITLE. (a) This title is enacted
2-20 as a part of the state's continuing statutory revision program,
2-21 begun by the Texas Legislative Council in 1963 as directed by the
2-22 legislature in the law codified as Section 323.007, Government
2-23 Code. The program contemplates a topic-by-topic revision of the
2-24 state's general and permanent statute law without substantive
2-25 change.
2-26 (b) Consistent with the objectives of the statutory revision
3-1 program, the purpose of this title is to make the law encompassed
3-2 by this title more accessible and understandable by:
3-3 (1) rearranging the statutes into a more logical
3-4 order;
3-5 (2) employing a format and numbering system designed
3-6 to facilitate citation of the law and to accommodate future
3-7 expansion of the law;
3-8 (3) eliminating repealed, duplicative,
3-9 unconstitutional, expired, executed, and other ineffective
3-10 provisions; and
3-11 (4) restating the law in modern American English to
3-12 the greatest extent possible. (New.)
3-13 Sec. 30.002. CONSTRUCTION OF TITLE. Chapter 311, Government
3-14 Code (Code Construction Act), applies to the construction of each
3-15 provision in this title except as otherwise expressly provided by
3-16 this title. (New.)
3-17 Sec. 30.003. REFERENCE IN LAW TO STATUTE REVISED BY TITLE.
3-18 A reference in a law to a statute or a part of a statute revised by
3-19 this title is considered to be a reference to the part of this
3-20 title that revises that statute or part of that statute. (New.)
3-21 CHAPTER 31. ORGANIZATION OF DEPARTMENT
3-22 SUBCHAPTER A. GENERAL PROVISIONS
3-23 Sec. 31.001. DEFINITIONS
3-24 Sec. 31.002. DUTIES OF DEPARTMENT
3-25 Sec. 31.003. COMPOSITION OF DEPARTMENT
3-26 Sec. 31.004. SUNSET PROVISION
4-1 Sec. 31.005. DEFENSE BY ATTORNEY GENERAL
4-2 Sec. 31.006. TEXAS WORKERS' COMPENSATION COMMISSION
4-3 NOT AFFECTED
4-4 Sec. 31.007. REFERENCES TO BOARD
4-5 (Sections 31.008 to 31.020 reserved for expansion
4-6 SUBCHAPTER B. COMMISSIONER OF INSURANCE
4-7 Sec. 31.021. CHIEF EXECUTIVE
4-8 Sec. 31.022. APPOINTMENT; TERM
4-9 Sec. 31.023. QUALIFICATIONS
4-10 Sec. 31.024. INELIGIBILITY FOR PUBLIC OFFICE
4-11 Sec. 31.025. BOND
4-12 Sec. 31.026. COMPENSATION
4-13 Sec. 31.027. GROUNDS FOR REMOVAL
4-14 (Sections 31.028 to 31.040 reserved for expansion
4-15 SUBCHAPTER C. PERSONNEL
4-16 Sec. 31.041. DEPARTMENT PERSONNEL
4-17 Sec. 31.042. DIVISION OF RESPONSIBILITIES
4-18 Sec. 31.043. EQUAL EMPLOYMENT OPPORTUNITY POLICY;
4-19 REPORT
4-20 Sec. 31.044. QUALIFICATIONS AND STANDARDS OF CONDUCT
4-21 Sec. 31.045. CAREER LADDER PROGRAM; PERFORMANCE
4-22 EVALUATIONS
4-23 CHAPTER 31. ORGANIZATION OF DEPARTMENT
4-24 SUBCHAPTER A. GENERAL PROVISIONS
4-25 Sec. 31.001. DEFINITIONS. In this code and other insurance
4-26 laws:
5-1 (1) "Commissioner" means the commissioner of
5-2 insurance.
5-3 (2) "Department" means the Texas Department of
5-4 Insurance. (V.T.I.C. Art. 1.01A, Subsec. (a).)
5-5 Sec. 31.002. DUTIES OF DEPARTMENT. In addition to the other
5-6 duties required of the Texas Department of Insurance, the
5-7 department shall:
5-8 (1) regulate the business of insurance in this state;
5-9 and
5-10 (2) ensure that this code and other laws regarding
5-11 insurance and insurance companies are executed. (V.T.I.C.
5-12 Art. 1.01A, Subsec. (b) (part); Art. 1.10, Sec. 1.)
5-13 Sec. 31.003. COMPOSITION OF DEPARTMENT. The department is
5-14 composed of the commissioner and other officers and employees
5-15 required to efficiently implement:
5-16 (1) this code;
5-17 (2) other insurance laws of this state; and
5-18 (3) other laws granting jurisdiction or applicable to
5-19 the department or the commissioner. (V.T.I.C. Art. 1.01A, Subsec.
5-20 (b) (part).)
5-21 Sec. 31.004. SUNSET PROVISION. The Texas Department of
5-22 Insurance is subject to Chapter 325, Government Code (Texas Sunset
5-23 Act). Unless continued in existence as provided by that chapter,
5-24 the department is abolished September 1, 2005. (V.T.I.C.
5-25 Art. 1.02, Subsec. (c).)
5-26 Sec. 31.005. DEFENSE BY ATTORNEY GENERAL. The attorney
6-1 general shall defend an action brought against the commissioner or
6-2 an employee or officer of the department as a result of that
6-3 person's official act or omission, whether or not at the time of
6-4 the institution of the action that person has terminated service
6-5 with the department. (V.T.I.C. Art. 1.40, Subsec. (a) (part).)
6-6 Sec. 31.006. TEXAS WORKERS' COMPENSATION COMMISSION NOT
6-7 AFFECTED. This code does not affect the duties imposed by law on
6-8 the Texas Workers' Compensation Commission. (V.T.I.C. Art. 1.07.)
6-9 Sec. 31.007. REFERENCES TO BOARD. A reference in this code
6-10 or other law to the State Board of Insurance, the Board of
6-11 Insurance Commissioners, or an individual commissioner means the
6-12 commissioner or the department as consistent with the respective
6-13 duties of the commissioner and the department under this code and
6-14 other insurance laws. (V.T.I.C. Art. 1.01A, Subsec. (c);
6-15 Art. 1.02, Subsec. (a) (part).)
6-16 (Sections 31.008 to 31.020 reserved for expansion
6-17 SUBCHAPTER B. COMMISSIONER OF INSURANCE
6-18 Sec. 31.021. CHIEF EXECUTIVE. (a) The commissioner is the
6-19 department's chief executive and administrative officer. The
6-20 commissioner shall administer and enforce this code, other
6-21 insurance laws of this state, and other laws granting jurisdiction
6-22 or applicable to the department or the commissioner.
6-23 (b) The commissioner has the powers and duties vested in the
6-24 department by this code and other insurance laws of this state.
6-25 (V.T.I.C. Art. 1.02, Subsec. (b) (part); Art. 1.09, Subsec. (a)
6-26 (part).)
7-1 Sec. 31.022. APPOINTMENT; TERM. (a) The governor, with the
7-2 advice and consent of the senate, shall appoint the commissioner.
7-3 The commissioner serves a two-year term that expires on February 1
7-4 of each odd-numbered year.
7-5 (b) The governor shall appoint the commissioner without
7-6 regard to the race, color, disability, sex, religion, age, or
7-7 national origin of the appointee. (V.T.I.C. Art. 1.09, Subsec. (b)
7-8 (part).)
7-9 Sec. 31.023. QUALIFICATIONS. The commissioner must:
7-10 (1) be a competent and experienced administrator;
7-11 (2) be well informed and qualified in the field of
7-12 insurance and insurance regulation; and
7-13 (3) have at least 10 years of experience as an
7-14 executive in the administration of business or government or as a
7-15 practicing attorney or certified public accountant, with at least
7-16 five years of that experience in the field of insurance or
7-17 insurance regulation. (V.T.I.C. Art. 1.09, Subsec. (b) (part).)
7-18 Sec. 31.024. INELIGIBILITY FOR PUBLIC OFFICE. The
7-19 commissioner is ineligible to be a candidate for a public elective
7-20 office in this state, unless the commissioner has resigned and the
7-21 governor has accepted the resignation. (V.T.I.C. Art. 1.09-2.)
7-22 Sec. 31.025. BOND. Before taking office, the commissioner
7-23 must execute with a surety company licensed to do business in this
7-24 state a bond for $50,000 payable to this state and conditioned on
7-25 the faithful discharge of the commissioner's duties. (V.T.I.C.
7-26 Art. 1.09, Subsec. (c).)
8-1 Sec. 31.026. COMPENSATION. The commissioner is entitled to
8-2 compensation as provided by the General Appropriations Act.
8-3 (V.T.I.C. Art. 1.09, Subsec. (d).)
8-4 Sec. 31.027. GROUNDS FOR REMOVAL. (a) It is a ground for
8-5 removal from office if the commissioner:
8-6 (1) does not have at the time of appointment the
8-7 qualifications required by Section 31.023;
8-8 (2) does not maintain during service as commissioner
8-9 the qualifications required by Section 31.023;
8-10 (3) violates a prohibition established by Section
8-11 33.001, 33.003, 33.004, or 33.005; or
8-12 (4) cannot, because of illness or disability,
8-13 discharge the commissioner's duties for a substantial part of the
8-14 commissioner's term.
8-15 (b) The validity of an action of the commissioner or the
8-16 department is not affected by the fact that it is taken when a
8-17 ground for removal of the commissioner exists. (V.T.I.C.
8-18 Art. 1.09, Subsecs. (i), (j).)
8-19 (Sections 31.028 to 31.040 reserved for expansion
8-20 SUBCHAPTER C. PERSONNEL
8-21 Sec. 31.041. DEPARTMENT PERSONNEL. (a) Subject to the
8-22 General Appropriations Act or other law, the commissioner shall
8-23 appoint deputies, assistants, and other personnel as necessary to
8-24 carry out the powers and duties of the commissioner and the
8-25 department under this code, other insurance laws of this state, and
8-26 other laws granting jurisdiction or applicable to the department or
9-1 the commissioner.
9-2 (b) A person appointed under this section must have the
9-3 professional, administrative, and insurance experience necessary to
9-4 qualify the person for the position to which the person is
9-5 appointed.
9-6 (c) A person appointed as an associate or deputy
9-7 commissioner or to hold an equivalent position must have at least
9-8 five years of the experience required for appointment as
9-9 commissioner under Section 31.023. At least two years of that
9-10 experience must be in work related to the position to be held.
9-11 (V.T.I.C. Art. 1.09, Subsec. (f).)
9-12 Sec. 31.042. DIVISION OF RESPONSIBILITIES. The commissioner
9-13 shall develop and implement policies that clearly define the
9-14 respective responsibilities of the commissioner and the staff of
9-15 the department. (V.T.I.C. Art. 1.02, Subsec. (g).)
9-16 Sec. 31.043. EQUAL EMPLOYMENT OPPORTUNITY POLICY; REPORT.
9-17 (a) The commissioner or the commissioner's designee shall prepare
9-18 and maintain a written policy statement to ensure implementation of
9-19 a program of equal employment opportunity under which all personnel
9-20 transactions are made without regard to race, color, disability,
9-21 sex, religion, age, or national origin. The policy statement must
9-22 include:
9-23 (1) personnel policies, including policies relating to
9-24 recruitment, evaluation, selection, appointment, training, and
9-25 promotion of personnel that are in compliance with Chapter 21,
9-26 Labor Code;
10-1 (2) a comprehensive analysis of the department
10-2 workforce that meets federal and state guidelines;
10-3 (3) procedures by which a determination can be made of
10-4 significant underuse in the department workforce of all persons for
10-5 whom federal or state guidelines encourage a more equitable
10-6 balance; and
10-7 (4) reasonable methods to appropriately address those
10-8 areas of significant underuse.
10-9 (b) A policy statement prepared under this section must:
10-10 (1) cover an annual period;
10-11 (2) be updated annually;
10-12 (3) be reviewed by the Commission on Human Rights for
10-13 compliance with Subsection (a); and
10-14 (4) be filed with the governor.
10-15 (c) The governor shall deliver a biennial report to the
10-16 legislature based on the information received under Subsection (b).
10-17 The report may be made separately or as a part of other biennial
10-18 reports made to the legislature. (V.T.I.C. Art. 1.02, Subsecs.
10-19 (d), (e), (f).)
10-20 Sec. 31.044. QUALIFICATIONS AND STANDARDS OF CONDUCT. The
10-21 commissioner shall provide to department employees, as often as
10-22 necessary, information regarding their:
10-23 (1) qualification for office or employment under this
10-24 code; and
10-25 (2) responsibilities under applicable laws relating to
10-26 standards of conduct for state employees. (V.T.I.C. Art. 1.02,
11-1 Subsec. (h).)
11-2 Sec. 31.045. CAREER LADDER PROGRAM; PERFORMANCE EVALUATIONS.
11-3 (a) The commissioner or the commissioner's designee shall develop
11-4 an intra-agency career ladder program. The program must require
11-5 intra-agency posting of all nonentry level positions concurrently
11-6 with any public posting.
11-7 (b) The commissioner or the commissioner's designee shall
11-8 develop a system of annual performance evaluations. All merit pay
11-9 for department employees must be based on the system established
11-10 under this subsection. (V.T.I.C. Art. 1.09, Subsecs. (g), (h).)
11-11 CHAPTER 32. ADMINISTRATIVE POWERS AND DUTIES
11-12 SUBCHAPTER A. RECORDS
11-13 Sec. 32.001. GIVING CERTIFIED COPIES AND CERTIFICATES
11-14 Sec. 32.002. RECORD OF DEPARTMENT PROCEEDINGS
11-15 Sec. 32.003. STATEMENTS REGARDING CONDITION OF
11-16 EXAMINED COMPANIES
11-17 (Sections 32.004 to 32.020 reserved for expansion
11-18 SUBCHAPTER B. REPORTS
11-19 Sec. 32.021. ANNUAL REPORTS
11-20 Sec. 32.022. BIENNIAL REPORT TO LEGISLATURE
11-21 Sec. 32.023. REPORTS TO OTHER STATES
11-22 (Sections 32.024 to 32.040 reserved for expansion
11-23 SUBCHAPTER C. FORMS
11-24 Sec. 32.041. FORMS
12-1 CHAPTER 32. ADMINISTRATIVE POWERS AND DUTIES
12-2 SUBCHAPTER A. RECORDS
12-3 Revised Law
12-4 Sec. 32.001. GIVING CERTIFIED COPIES AND CERTIFICATES.
12-5 (a) On request and on payment of the required fee, the department:
12-6 (1) may certify a copy of a paper or a record in a
12-7 department office and give the certified copy to any person if the
12-8 commissioner determines that providing the copy is not prejudicial
12-9 to the public interest; and
12-10 (2) shall give a certificate as provided by other law.
12-11 (b) A fee collected by the department under this section
12-12 shall be deposited in the general revenue fund to the credit of the
12-13 Texas Department of Insurance operating account. (V.T.I.C.
12-14 Art. 1.10, Sec. 11.)
12-15 Sec. 32.002. RECORD OF DEPARTMENT PROCEEDINGS. The
12-16 department shall maintain a complete record of the department's
12-17 proceedings. (V.T.I.C. Art. 1.10, Sec. 10 (part).)
12-18 Sec. 32.003. STATEMENTS REGARDING CONDITION OF EXAMINED
12-19 COMPANIES. The department shall maintain a concise statement of
12-20 the condition of each company or agency visited or examined.
12-21 (V.T.I.C. Art. 1.10, Sec. 10 (part).)
12-22 (Sections 32.004 to 32.020 reserved for expansion
12-23 SUBCHAPTER B. REPORTS
12-24 Sec. 32.021. ANNUAL REPORTS. (a) The department shall file
12-25 annually with the governor and the presiding officer of each house
12-26 of the legislature a complete and detailed written report that
13-1 includes:
13-2 (1) an accounting of all funds received and disbursed
13-3 by the department during the preceding fiscal year;
13-4 (2) a description of the commissioner's official acts;
13-5 (3) a description of the condition of companies doing
13-6 business in this state; and
13-7 (4) other information that exhibits the affairs of the
13-8 department.
13-9 (b) The annual report required by Subsection (a) must be in
13-10 the form and reported in the time provided by the General
13-11 Appropriations Act.
13-12 (c) The department shall:
13-13 (1) send a copy of the annual report required by
13-14 Subsection (a) to the insurance commissioner or other similar
13-15 officer of every state; and
13-16 (2) on request, send a copy to any company doing
13-17 business in this state.
13-18 (d) The department shall print a separate premium and loss
13-19 report that contains and arranges in tabular form the premium and
13-20 loss information contained in the annual statements for companies
13-21 doing business in this state.
13-22 (e) The department shall file the report required by
13-23 Subsection (d) with the Legislative Reference Library and the Texas
13-24 State Library with the annual report required by Subsection (a).
13-25 (f) The department shall notify the legislature of the
13-26 availability of the reports required by this section. (V.T.I.C.
14-1 Art. 1.10, Secs. 12, 13; Art. 1.25, Subsec. (b).)
14-2 Sec. 32.022. BIENNIAL REPORT TO LEGISLATURE. (a) On or
14-3 before December 31 of each even-numbered year, the department shall
14-4 submit to the appropriate committees of each house of the
14-5 legislature a written report that indicates any needed changes in
14-6 the laws relating to regulation of the insurance industry or any
14-7 other industry or occupation under the jurisdiction of the
14-8 department and that states the reasons for the needed changes.
14-9 (b) If the commissioner determines that any capital or
14-10 surplus requirements established by this code for any insurance
14-11 companies are inadequate, the department shall:
14-12 (1) include in the biennial report specific
14-13 recommendations relating to the amounts at which the capital or
14-14 surplus requirements should be set and the findings and evidence on
14-15 which those recommendations are based; and
14-16 (2) submit the biennial report to the governor.
14-17 (V.T.I.C. Art. 1.25, Subsec. (a); Art. 1.25A.)
14-18 Sec. 32.023. REPORTS TO OTHER STATES. On request, the
14-19 department shall provide to the insurance commissioner or other
14-20 similar officer of another state information relating to a company
14-21 of this state that does business in the other state if:
14-22 (1) the other state has enacted the substantial
14-23 provisions of the insurance laws of this state; and
14-24 (2) the commissioner or other similar officer has a
14-25 legal duty to obtain the information. (V.T.I.C. Art. 1.10, Sec.
14-26 14.)
15-1 (Sections 32.024 to 32.040 reserved for expansion
15-2 SUBCHAPTER C. FORMS
15-3 Sec. 32.041. FORMS. The department shall furnish to the
15-4 companies required to report to the department the necessary forms
15-5 for the required statements. (V.T.I.C. Art. 1.10, Sec. 9.)
15-6 CHAPTER 33. STANDARDS OF CONDUCT
15-7 Sec. 33.001. APPLICATION OF LAW RELATING TO ETHICAL CONDUCT
15-8 Sec. 33.002. INSURANCE BUSINESS INTEREST; SERVICE AS
15-9 COMMISSIONER
15-10 Sec. 33.003. INSURANCE BUSINESS INTEREST; EMPLOYEE
15-11 Sec. 33.004. TRADE ASSOCIATIONS
15-12 Sec. 33.005. LOBBYING ACTIVITIES
15-13 Sec. 33.006. FORMER SERVICE
15-14 Sec. 33.007. PROHIBITED REPRESENTATION
15-15 CHAPTER 33. STANDARDS OF CONDUCT
15-16 Sec. 33.001. APPLICATION OF LAW RELATING TO ETHICAL CONDUCT.
15-17 The commissioner and each employee or agent of the department is
15-18 subject to the code of ethics and the standard of conduct imposed
15-19 by Chapter 572, Government Code, and any other law regulating the
15-20 ethical conduct of state officers and employees. (V.T.I.C.
15-21 Art. 1.09-3.)
15-22 Sec. 33.002. INSURANCE BUSINESS INTEREST; SERVICE AS
15-23 COMMISSIONER. (a) A person is not eligible for appointment as
15-24 commissioner if the person, the person's spouse, or any other
15-25 person who resides in the same household as the person:
15-26 (1) is registered, certified, or licensed by the
16-1 department;
16-2 (2) is employed by or participates in the management
16-3 of a business entity or other organization regulated by or
16-4 receiving funds from the department;
16-5 (3) owns or controls, directly or indirectly, more
16-6 than a 10 percent interest in a business entity or other
16-7 organization regulated by or receiving funds from the department;
16-8 or
16-9 (4) uses or receives a substantial amount of tangible
16-10 goods, services, or funds from the department, other than
16-11 compensation or reimbursement authorized by law.
16-12 (b) A person is not eligible for appointment as commissioner
16-13 if the person:
16-14 (1) is a stockholder, director, officer, attorney,
16-15 agent, or employee of an insurance company, insurance agent,
16-16 insurance broker, or insurance adjuster; or
16-17 (2) is directly or indirectly interested in a business
16-18 described by Subdivision (1).
16-19 (c) Subsection (b) does not apply to:
16-20 (1) a person solely because the person is insured by
16-21 an insurer or is the beneficiary of insurance; or
16-22 (2) a person who:
16-23 (A) is appointed as a receiver, liquidator,
16-24 supervisor, or conservator of an insurer; or
16-25 (B) is an employee of a receiver, liquidator,
16-26 supervisor, or conservator of an insurer with respect to duties
17-1 under that employment. (V.T.I.C. Art. 1.06, Subsec. (a);
17-2 Art. 1.09, Subsec. (b) (part).)
17-3 Sec. 33.003. INSURANCE BUSINESS INTEREST; EMPLOYEE. (a) A
17-4 person who is a director, officer, attorney, agent, or employee of
17-5 an insurance company, insurance agent, insurance broker, or
17-6 insurance adjuster may not be employed by the department.
17-7 (b) A person who resides in the same household as a person
17-8 who is an officer, managerial employee, or paid consultant in the
17-9 insurance industry may not be employed in an exempt salary position
17-10 as defined by the General Appropriations Act. (V.T.I.C. Art. 1.06,
17-11 Subsec. (b); Art. 1.06AA.)
17-12 Sec. 33.004. TRADE ASSOCIATIONS. (a) A person who is an
17-13 officer, employee, or paid consultant of a trade association in the
17-14 field of insurance may not be:
17-15 (1) the commissioner; or
17-16 (2) an employee of the department who is exempt from
17-17 the state's position classification plan or is compensated at or
17-18 above the amount prescribed by the General Appropriations Act for
17-19 step 1, salary group A17, of the position classification salary
17-20 schedule.
17-21 (b) A person who is the spouse of an officer, manager, or
17-22 paid consultant of a trade association in the field of insurance
17-23 may not be:
17-24 (1) the commissioner; or
17-25 (2) an employee of the department who is exempt from
17-26 the state's position classification plan or is compensated at or
18-1 above the amount prescribed by the General Appropriations Act for
18-2 step 1, salary group A17, of the position classification salary
18-3 schedule.
18-4 (c) In this section, "trade association" means a nonprofit,
18-5 cooperative, and voluntarily joined association of business or
18-6 professional competitors designed to assist its members and its
18-7 industry or profession in dealing with mutual business or
18-8 professional problems and in promoting their common interest.
18-9 (V.T.I.C. Art. 1.06A.)
18-10 Sec. 33.005. LOBBYING ACTIVITIES. A person may not serve as
18-11 the commissioner or act as the general counsel to the commissioner
18-12 if the person is required to register as a lobbyist under Chapter
18-13 305, Government Code, because of the person's activities for
18-14 compensation on behalf of a profession related to the operation of
18-15 the department. (V.T.I.C. Art. 1.06B.)
18-16 Sec. 33.006. FORMER SERVICE. A person may not serve as the
18-17 commissioner if the person served as a member of the State Board of
18-18 Insurance. (V.T.I.C. Art. 1.09, Subsec. (b) (part).)
18-19 Sec. 33.007. PROHIBITED REPRESENTATION. (a) A person who
18-20 served as the commissioner, the general counsel to the
18-21 commissioner, or the public insurance counsel, or as an employee of
18-22 the State Office of Administrative Hearings who was involved in
18-23 hearing cases under this code or another insurance law of this
18-24 state, commits an offense if the person represents another person
18-25 in a matter before the department or receives compensation for
18-26 services performed on behalf of another person regarding a matter
19-1 pending before the department during the one-year period after the
19-2 date the person ceased to be the commissioner, the general counsel
19-3 to the commissioner, the public insurance counsel, or an employee
19-4 of the State Office of Administrative Hearings.
19-5 (b) A person who served as a member of the State Board of
19-6 Insurance or as a staff employee of a member of the State Board of
19-7 Insurance, or who served as the commissioner, the general counsel
19-8 to the commissioner, or the public insurance counsel or as an
19-9 employee of the department or the State Office of Administrative
19-10 Hearings, commits an offense if, after the person ceased to serve,
19-11 the person represents another person or receives compensation for
19-12 services performed on behalf of another person regarding a matter
19-13 with which the person was directly concerned during the person's
19-14 service. For purposes of this subsection, a person was directly
19-15 concerned with a matter if the person had personal involvement with
19-16 the matter or if the matter was within the scope of the person's
19-17 official responsibility.
19-18 (c) An offense under this section is a Class A misdemeanor.
19-19 (d) This section does not apply to a department employee
19-20 whose position is eliminated as a direct result of a reduction in
19-21 the department's workforce. (V.T.I.C. Art. 1.06C.)
19-22 CHAPTER 34. IMMUNITY FROM LIABILITY
19-23 Sec. 34.001. PERSONAL IMMUNITY
19-24 Sec. 34.002. IMMUNITY FOR FURNISHING INFORMATION RELATING
19-25 TO FRAUD
19-26 Sec. 34.003. IMMUNITY FOR INVESTIGATIONS AND RELATED REPORTS
20-1 Sec. 34.004. IMMUNITY FOR USE OF ANNUAL STATEMENT
20-2 INFORMATION
20-3 Sec. 34.005. EFFECT OF CHAPTER ON OTHER IMMUNITY
20-4 CHAPTER 34. IMMUNITY FROM LIABILITY
20-5 Sec. 34.001. PERSONAL IMMUNITY. A person who is the
20-6 commissioner or an employee of the department is not personally
20-7 liable in a civil action for:
20-8 (1) an act performed in good faith within the scope of
20-9 that person's authority; or
20-10 (2) damages caused by an official act or omission of
20-11 that person unless the act or omission is corrupt or malicious.
20-12 (V.T.I.C. Art. 1.40, Subsec. (a) (part).)
20-13 Sec. 34.002. IMMUNITY FOR FURNISHING INFORMATION RELATING TO
20-14 FRAUD. (a) A person is not liable in a civil action, including an
20-15 action for libel or slander, and a civil action may not be brought
20-16 against the person, for furnishing information relating to
20-17 suspected, anticipated, or completed fraudulent insurance acts if
20-18 the information is provided to or received from:
20-19 (1) the commissioner or an employee of the department;
20-20 (2) a law enforcement agency of this state, of another
20-21 state, or of the United States or an employee of the agency;
20-22 (3) the National Association of Insurance
20-23 Commissioners or an employee of the association; or
20-24 (4) a state or federal governmental agency established
20-25 to detect and prevent fraudulent insurance acts or to regulate the
20-26 business of insurance or an employee of the agency.
21-1 (b) A person may furnish information as described in
21-2 Subsection (a) orally or in writing, including through publishing,
21-3 disseminating, or filing bulletins or reports.
21-4 (c) Subsection (a) does not apply to a person who acts with
21-5 malice, fraudulent intent, or bad faith.
21-6 (d) A person to whom Subsection (a) applies who prevails in
21-7 a civil action arising from the furnishing of information as
21-8 described in Subsection (a) is entitled to attorney's fees and
21-9 costs if the action was not substantially justified. In this
21-10 subsection, "substantially justified" means there was a reasonable
21-11 basis in law or fact to bring the action at the time the action was
21-12 initiated. (V.T.I.C. Art. 1.40, Subsecs. (b), (c), (d).)
21-13 Sec. 34.003. IMMUNITY FOR INVESTIGATIONS AND RELATED
21-14 REPORTS. (a) A person who is the commissioner or an employee,
21-15 agent, or designee of the department is not liable in a civil
21-16 action, including an action for libel or slander, because of:
21-17 (1) an investigation of a violation of this code or an
21-18 alleged fraudulent insurance act; or
21-19 (2) the publication or dissemination of an official
21-20 report related to the investigation.
21-21 (b) Subsection (a) does not apply to a person who acts with
21-22 malice. (V.T.I.C. Art. 1.40, Subsec. (f).)
21-23 Sec. 34.004. IMMUNITY FOR USE OF ANNUAL STATEMENT
21-24 INFORMATION. (a) A person is not liable in a civil action,
21-25 including an action for libel or slander, for collecting,
21-26 reviewing, analyzing, disseminating, or reporting information
22-1 collected from annual statements filed under Article 1.11 if the
22-2 person is:
22-3 (1) the department, the commissioner, or an employee
22-4 of the department;
22-5 (2) a member or employee of or delegate to the
22-6 National Association of Insurance Commissioners or an authorized
22-7 committee, subcommittee, or task force of that association; or
22-8 (3) another person who is responsible for collecting,
22-9 reviewing, analyzing, and disseminating information from filed
22-10 annual statement convention blanks.
22-11 (b) Subsection (a) does not apply to a person who acts with
22-12 malice. (V.T.I.C. Art. 1.40, Subsec. (e).)
22-13 Sec. 34.005. EFFECT OF CHAPTER ON OTHER IMMUNITY. This
22-14 chapter does not affect or modify any common law or statutory
22-15 privilege or immunity. (V.T.I.C. Art. 1.40, Subsec. (g).)
22-16 (Chapter 35 reserved for expansion
22-17 CHAPTER 36. DEPARTMENT RULES AND PROCEDURES
22-18 SUBCHAPTER A. RULES
22-19 Sec. 36.001. RULES FOR GENERAL AND UNIFORM APPLICATION
22-20 Sec. 36.002. FISCAL IMPACT OF DEPARTMENT RULES
22-21 Sec. 36.003. RULES RESTRICTING ADVERTISING OR COMPETITIVE
22-22 BIDDING
22-23 Sec. 36.004. COMPLIANCE WITH NATIONAL ASSOCIATION OF INSURANCE
22-24 COMMISSIONERS REQUIREMENTS
22-25 (Sections 36.005 to 36.100 reserved for expansion
23-1 SUBCHAPTER B. DEPARTMENT PROCEDURES
23-2 Sec. 36.101. APPLICABILITY OF CERTAIN LAWS
23-3 Sec. 36.102. SUMMARY PROCEDURES FOR ROUTINE MATTERS
23-4 Sec. 36.103. REVIEW OF ACTION ON ROUTINE MATTER
23-5 Sec. 36.104. INFORMAL DISPOSITION OF CONTESTED CASE
23-6 Sec. 36.105. NEWSPAPER PUBLICATION
23-7 Sec. 36.106. WAIVER OF CERTAIN NOTICE REQUIREMENTS
23-8 Sec. 36.107. ACCEPTANCE OF ACTUARIAL OPINION
23-9 (Sections 36.108 to 36.150 reserved for expansion
23-10 SUBCHAPTER C. GENERAL SUBPOENA POWERS; WITNESSES AND
23-11 PRODUCTION OF RECORDS
23-12 Sec. 36.151. DEFINITION
23-13 Sec. 36.152. SUBPOENA AUTHORITY
23-14 Sec. 36.153. SERVICE OF SUBPOENA
23-15 Sec. 36.154. ENFORCEMENT OF SUBPOENA
23-16 Sec. 36.155. COMPENSATION FOR ATTENDANCE
23-17 Sec. 36.156. OUT-OF-STATE MATERIALS
23-18 Sec. 36.157. USE AS EVIDENCE IN CERTAIN CASES
23-19 Sec. 36.158. ACCESS TO INFORMATION
23-20 Sec. 36.159. PRIVILEGED AND CONFIDENTIAL RECORDS AND
23-21 INFORMATION; PROTECTIVE ORDERS
23-22 Sec. 36.160. COOPERATION WITH LAW ENFORCEMENT
23-23 Sec. 36.161. CERTAIN SUBPOENAS ISSUED TO FINANCIAL
23-24 INSTITUTIONS
23-25 Sec. 36.162. EFFECT ON CONTESTED CASE
23-26 (Sections 36.163 to 36.200 reserved for expansion
24-1 SUBCHAPTER D. JUDICIAL REVIEW
24-2 Sec. 36.201. ACTION SUBJECT TO JUDICIAL REVIEW
24-3 Sec. 36.202. PETITION FOR JUDICIAL REVIEW
24-4 Sec. 36.203. JUDICIAL REVIEW
24-5 Sec. 36.204. ACTION NOT VACATED
24-6 Sec. 36.205. APPEAL
24-7 CHAPTER 36. DEPARTMENT RULES AND PROCEDURES
24-8 SUBCHAPTER A. RULES
24-9 Sec. 36.001. RULES FOR GENERAL AND UNIFORM APPLICATION.
24-10 (a) The commissioner may adopt rules for the conduct and execution
24-11 of the powers and duties of the department only as authorized by
24-12 statute.
24-13 (b) Rules adopted under this section must have general and
24-14 uniform application.
24-15 (c) The commissioner shall publish the rules in a format
24-16 organized by subject matter. The published rules shall be kept
24-17 current and be available in a form convenient to any interested
24-18 person. (V.T.I.C. Art. 1.03A.)
24-19 Sec. 36.002. FISCAL IMPACT OF DEPARTMENT RULES. (a) A rule
24-20 adopted by the commissioner under Chapter 2001, Government Code, is
24-21 void if:
24-22 (1) the fiscal note or the public benefit-cost note
24-23 required by Section 2001.024, Government Code, does not accurately
24-24 state the reasonable actual costs required; and
24-25 (2) the reasonable actual costs required exceed the
24-26 stated costs by at least 25 percent.
25-1 (b) A rule that is void under this section is void beginning
25-2 on the date the rule is adopted. (V.T.I.C. Art. 1.03B.)
25-3 Sec. 36.003. RULES RESTRICTING ADVERTISING OR COMPETITIVE
25-4 BIDDING. The commissioner may not adopt rules restricting
25-5 advertising or competitive bidding by a person regulated by the
25-6 department except to prohibit false, misleading, or deceptive
25-7 practices by the person. (V.T.I.C. Art. 21.20-1.)
25-8 Sec. 36.004. COMPLIANCE WITH NATIONAL ASSOCIATION OF
25-9 INSURANCE COMMISSIONERS REQUIREMENTS. The department may not
25-10 require an insurer to comply with a rule, regulation, directive, or
25-11 standard adopted by the National Association of Insurance
25-12 Commissioners, including a rule, regulation, directive, or standard
25-13 relating to policy reserves, unless application of the rule,
25-14 regulation, directive, or standard is expressly authorized by
25-15 statute and approved by the commissioner. (V.T.I.C. Art. 1.27.)
25-16 (Sections 36.005 to 36.100 reserved for expansion
25-17 SUBCHAPTER B. DEPARTMENT PROCEDURES
25-18 Sec. 36.101. APPLICABILITY OF CERTAIN LAWS. Except as
25-19 specifically provided by law, the department is subject to Chapters
25-20 2001 and 2002, Government Code. (V.T.I.C. Art. 1.33A (part).)
25-21 Sec. 36.102. SUMMARY PROCEDURES FOR ROUTINE MATTERS.
25-22 (a) The commissioner by rule may:
25-23 (1) create a summary procedure for routine matters;
25-24 and
25-25 (2) designate department activities that otherwise
25-26 would be subject to Chapter 2001, Government Code, as routine
26-1 matters to be handled under the summary procedure.
26-2 (b) An activity may be designated as a routine matter only
26-3 if the activity is:
26-4 (1) voluminous;
26-5 (2) repetitive;
26-6 (3) believed to be noncontroversial; and
26-7 (4) of limited interest to anyone other than persons
26-8 immediately involved in or affected by the proposed department
26-9 action.
26-10 (c) The rules may establish procedures different from those
26-11 contained in Chapter 2001, Government Code. The procedures must
26-12 require, for each party directly involved, notice of a proposed
26-13 negative action not later than the fifth day before the date the
26-14 action is proposed to be taken.
26-15 (d) The rules may provide for the delegation of authority to
26-16 take action on a routine matter to a salaried employee of the
26-17 department designated by the commissioner. (V.T.I.C. Art. 1.33,
26-18 Subsecs. (a), (b), (c).)
26-19 Sec. 36.103. REVIEW OF ACTION ON ROUTINE MATTER. (a) A
26-20 person directly or indirectly affected by an action of the
26-21 commissioner or the department on a routine matter taken under the
26-22 summary procedure adopted under Section 36.102 is entitled to a
26-23 review of the action under Chapter 2001, Government Code.
26-24 (b) The person must apply to the commissioner not later than
26-25 the 60th day after the date of the action to be entitled to the
26-26 review.
27-1 (c) The timely filing of the application for review
27-2 immediately stays the action pending a hearing on the merits.
27-3 (d) The commissioner may adopt rules relating to an
27-4 application for review under this section and consideration of the
27-5 application. (V.T.I.C. Art. 1.33, Subsec. (d).)
27-6 Sec. 36.104. INFORMAL DISPOSITION OF CONTESTED CASE. The
27-7 commissioner may, on written agreement or stipulation of each party
27-8 and any intervenor, informally dispose of a contested case in
27-9 accordance with Section 2001.056, Government Code, notwithstanding
27-10 any provision of this code that requires a hearing before the
27-11 commissioner. (V.T.I.C. Art. 1.33, Subsec. (e) (part).)
27-12 Sec. 36.105. NEWSPAPER PUBLICATION. Except as otherwise
27-13 provided by law, a notice or other matter that this code requires
27-14 to be published must be published for three successive weeks in two
27-15 newspapers that:
27-16 (1) are printed in this state; and
27-17 (2) have a general circulation in this state.
27-18 (V.T.I.C. Art. 21.30.)
27-19 Sec. 36.106. WAIVER OF CERTAIN NOTICE REQUIREMENTS. The
27-20 commissioner may, on written agreement or stipulation of each party
27-21 and any intervenor, waive or modify the notice publication
27-22 requirement of Article 2.01, 2.03, 3.04, or 22.03. (V.T.I.C.
27-23 Art. 1.33, Subsec. (e) (part).)
27-24 Sec. 36.107. ACCEPTANCE OF ACTUARIAL OPINION. An opinion of
27-25 an actuary requested by the commissioner under this code, another
27-26 insurance law of this state, or a rule of the commissioner is
28-1 presumed to be accurate and valid, and the department shall accept
28-2 the opinion unless controverted. The department may employ, at the
28-3 department's expense, another actuary to provide an alternative
28-4 opinion. (V.T.I.C. Art. 1.11A.)
28-5 (Sections 36.108 to 36.150 reserved for expansion
28-6 SUBCHAPTER C. GENERAL SUBPOENA POWERS; WITNESSES AND
28-7 PRODUCTION OF RECORDS
28-8 Sec. 36.151. DEFINITION. In this subchapter, "records"
28-9 includes books, accounts, documents, papers, correspondence, and
28-10 other material. (V.T.I.C. Art. 1.19-1, Secs. 1(a) (part), (e)
28-11 (part), 2 (part), 3 (part), 5(a) (part); New.)
28-12 Sec. 36.152. SUBPOENA AUTHORITY. (a) With respect to a
28-13 matter that the commissioner has authority to consider or
28-14 investigate, the commissioner may issue a subpoena applicable
28-15 throughout the state that requires:
28-16 (1) the attendance and testimony of a witness; and
28-17 (2) the production of records.
28-18 (b) In connection with a subpoena, the commissioner may
28-19 require attendance and production of records before the
28-20 commissioner or the commissioner's designee:
28-21 (1) at the department's offices in Austin; or
28-22 (2) at another place designated by the commissioner.
28-23 (c) In connection with a subpoena, the commissioner or the
28-24 commissioner's designee may administer an oath, examine a witness,
28-25 or receive evidence.
28-26 (d) Subject to Section 36.102(d), the commissioner must
29-1 personally sign and issue the subpoena. (V.T.I.C. Art. 1.19-1,
29-2 Sec. 1(a) (part).)
29-3 Sec. 36.153. SERVICE OF SUBPOENA. (a) A subpoena issued by
29-4 the commissioner may be served, at the discretion of the
29-5 commissioner, by the commissioner, an authorized agent of the
29-6 commissioner, a sheriff, or a constable.
29-7 (b) The sheriff's or constable's fee for serving the
29-8 subpoena is the same as the fee paid to the sheriff or constable
29-9 for similar services. (V.T.I.C. Art. 1.19-1, Sec. 4(b).)
29-10 Sec. 36.154. ENFORCEMENT OF SUBPOENA. (a) On application
29-11 of the commissioner in the case of disobedience of a subpoena or
29-12 the contumacy of a person, a district court may issue an order
29-13 requiring a person subpoenaed to obey the subpoena, to give
29-14 evidence, or to produce records if the person has refused to do so.
29-15 (b) A court may punish as contempt the failure to obey a
29-16 court order under Subsection (a).
29-17 (c) If the court orders compliance with the subpoena or
29-18 finds the person in contempt for failure to obey the order, the
29-19 commissioner, or the attorney general when representing the
29-20 department, may recover reasonable costs and fees, including
29-21 attorney's fees and investigative costs incurred in the
29-22 proceedings.
29-23 (d) An application under Subsection (a) must be made in a
29-24 district court in Travis County or in the county in which the
29-25 subpoena is served. (V.T.I.C. Art. 1.19-1, Sec. 3 (part).)
29-26 Sec. 36.155. COMPENSATION FOR ATTENDANCE. A person required
30-1 by subpoena to attend a proceeding before the commissioner or the
30-2 commissioner's designee is entitled to:
30-3 (1) reimbursement for mileage in the same amount for
30-4 each mile as the mileage travel allowance for a state employee for
30-5 traveling to or from the place where the person's attendance is
30-6 required, if the place is more than 25 miles from the person's
30-7 place of residence; and
30-8 (2) a fee for each day or part of a day the person is
30-9 required to be present as a witness that is equal to the greater
30-10 of:
30-11 (A) $10; or
30-12 (B) a state employee's per diem travel
30-13 allowance. (V.T.I.C. Art. 1.19-1, Sec. 4(a).)
30-14 Sec. 36.156. OUT-OF-STATE MATERIALS. (a) A person with
30-15 materials located outside this state that are requested by the
30-16 commissioner may make the materials available for examination at
30-17 the place where the materials are located.
30-18 (b) The commissioner may designate a representative,
30-19 including an official of the state in which the materials are
30-20 located, to examine the materials.
30-21 (c) The commissioner may respond to a similar request from
30-22 an official of another state or of the United States. (V.T.I.C.
30-23 Art. 1.19-1, Sec. 1(b).)
30-24 Sec. 36.157. USE AS EVIDENCE IN CERTAIN CASES. (a) This
30-25 section applies to testimony or records resulting in a case
30-26 involving an allegation of engaging in the business of insurance
31-1 without a license.
31-2 (b) On certification by the commissioner under official
31-3 seal, testimony taken or records produced under this subchapter and
31-4 held by the department are admissible in evidence in a case
31-5 without:
31-6 (1) prior proof of correctness; and
31-7 (2) proof, other than the certificate of the
31-8 commissioner, that the testimony or records were received from the
31-9 person testifying or producing the records.
31-10 (c) The certified records, or certified copies of the
31-11 records, are prima facie evidence of the facts disclosed by the
31-12 records.
31-13 (d) This section does not limit any other provision of this
31-14 subchapter or any law that makes provision for the admission or
31-15 evidentiary value of certain evidence. (V.T.I.C. Art. 1.19-1, Sec.
31-16 2 (part).)
31-17 Sec. 36.158. ACCESS TO INFORMATION. (a) A record or other
31-18 evidence acquired under a subpoena under this subchapter is not a
31-19 public record for the period the commissioner considers reasonably
31-20 necessary to:
31-21 (1) complete the investigation;
31-22 (2) protect the person being investigated from
31-23 unwarranted injury; or
31-24 (3) serve the public interest.
31-25 (b) The record or other evidence is not subject to a
31-26 subpoena, other than a grand jury subpoena, until:
32-1 (1) the record or other evidence is released for
32-2 public inspection by the commissioner; or
32-3 (2) after notice and a hearing, a district court
32-4 determines that obeying the subpoena would not jeopardize the
32-5 public interest and any investigation by the commissioner.
32-6 (c) Except for good cause, a district court order under
32-7 Subsection (b) may not apply to:
32-8 (1) a record or communication received from another
32-9 law enforcement or regulatory agency; or
32-10 (2) the internal notes, memoranda, reports, or
32-11 communications made in connection with a matter that the
32-12 commissioner has the authority to consider or investigate.
32-13 (V.T.I.C. Art. 1.19-1, Sec. 1(d).)
32-14 Sec. 36.159. PRIVILEGED AND CONFIDENTIAL RECORDS AND
32-15 INFORMATION; PROTECTIVE ORDERS. (a) A record subpoenaed and
32-16 produced under this subchapter that is otherwise privileged or
32-17 confidential by law remains privileged or confidential until
32-18 admitted into evidence in an administrative hearing or a court.
32-19 (b) The commissioner may issue a protective order relating
32-20 to the confidentiality or privilege of a record described by
32-21 Subsection (a) to restrict the use or distribution of the record:
32-22 (1) by a person; or
32-23 (2) in a proceeding other than a proceeding before the
32-24 commissioner.
32-25 (c) Specific information relating to a particular policy or
32-26 claim is privileged and confidential while in the possession of an
33-1 insurance company, organization, association, or other entity
33-2 holding a certificate of authority from the department and may not
33-3 be disclosed by the entity to another person, except as
33-4 specifically provided by law. (V.T.I.C. Art. 1.19-1, Secs. 5(a)
33-5 (part), (b).)
33-6 Sec. 36.160. COOPERATION WITH LAW ENFORCEMENT. On request,
33-7 the commissioner may furnish records or other evidence obtained by
33-8 subpoena to:
33-9 (1) a law enforcement agency of this state, another
33-10 state, or the United States; or
33-11 (2) a prosecuting attorney of a municipality, county,
33-12 or judicial district of this state, another state, or the United
33-13 States. (V.T.I.C. Art. 1.19-1, Sec. 1(e) (part).)
33-14 Sec. 36.161. CERTAIN SUBPOENAS ISSUED TO FINANCIAL
33-15 INSTITUTIONS. A subpoena issued to a bank or other financial
33-16 institution as part of a criminal investigation is not subject to
33-17 Section 30.007, Civil Practice and Remedies Code. (V.T.I.C.
33-18 Art. 1.19-1, Sec. 1(c).)
33-19 Sec. 36.162. EFFECT ON CONTESTED CASE. Sections 36.152,
33-20 36.156, 36.158, 36.160, and 36.161 do not affect the conduct of a
33-21 contested case under Chapter 2001, Government Code. (V.T.I.C.
33-22 Art. 1.19-1, Sec. 1(g).)
33-23 (Sections 36.163 to 36.200 reserved for expansion
33-24 SUBCHAPTER D. JUDICIAL REVIEW
33-25 Sec. 36.201. ACTION SUBJECT TO JUDICIAL REVIEW. An action
33-26 of the commissioner subject to judicial review under this
34-1 subchapter includes a decision, order, rate, rule, form, or
34-2 administrative or other ruling of the commissioner. (V.T.I.C.
34-3 Art. 1.04, Subsec. (a) (part).)
34-4 Sec. 36.202. PETITION FOR JUDICIAL REVIEW. (a) After
34-5 failing to get relief from the commissioner, any insurance company
34-6 or other party at interest who is dissatisfied with an action of
34-7 the commissioner may file a petition for judicial review against
34-8 the commissioner as defendant.
34-9 (b) The petition must state the particular objection to the
34-10 action and may be filed only in a district court in Travis County.
34-11 (V.T.I.C. Art. 1.04, Subsec. (a) (part).)
34-12 Sec. 36.203. JUDICIAL REVIEW. Judicial review of the action
34-13 is under the substantial evidence rule and shall be conducted under
34-14 Chapter 2001, Government Code. (V.T.I.C. Art. 1.04, Subsec. (a)
34-15 (part).)
34-16 Sec. 36.204. ACTION NOT VACATED. (a) The filing of a
34-17 petition for judicial review of an action under this subchapter
34-18 does not vacate the action.
34-19 (b) After notice and hearing, the court may vacate the
34-20 action if the court finds it would serve the interest of justice to
34-21 do so. (V.T.I.C. Art. 1.04, Subsec. (a) (part).)
34-22 Sec. 36.205. APPEAL. (a) A party to the action under
34-23 Section 36.202 may appeal to an appellate court that has
34-24 jurisdiction, and the appeal is at once returnable to that court.
34-25 (b) An appeal under this section has precedence in the
34-26 appellate court over any cause of a different character pending in
35-1 the court.
35-2 (c) The commissioner is not required to give an appeal bond
35-3 in an appeal arising under this subchapter. (V.T.I.C. Art. 1.04,
35-4 Subsecs. (a) (part), (b).)
35-5 CHAPTER 37. RATEMAKING AND POLICY FORM PROCEEDINGS
35-6 SUBCHAPTER A. GENERAL PROVISIONS
35-7 Sec. 37.001. CERTAIN PROCEEDINGS RELATING TO RATEMAKING
35-8 AND POLICY FORMS; RULES
35-9 (Sections 37.002 to 37.050 reserved for expansion
35-10 SUBCHAPTER B. CERTAIN PROCEEDINGS RELATING TO RATES
35-11 Sec. 37.051. STREAMLINED PROCEDURES
35-12 Sec. 37.052. ROLE OF DEPARTMENT
35-13 CHAPTER 37. RATEMAKING AND POLICY FORM PROCEEDINGS
35-14 SUBCHAPTER A. GENERAL PROVISIONS
35-15 Sec. 37.001. CERTAIN PROCEEDINGS RELATING TO RATEMAKING AND
35-16 POLICY FORMS; RULES. (a) The commissioner shall adopt rules
35-17 governing proceedings necessary to approve or promulgate rates,
35-18 policy forms, or policy form endorsements under this code or
35-19 another insurance law of this state.
35-20 (b) The commissioner shall conduct the proceedings in
35-21 accordance with the rules adopted under this section.
35-22 (c) Rules adopted under this section must comply with this
35-23 code and any other insurance law of this state and must be adopted
35-24 in accordance with Chapter 2001, Government Code. (V.T.I.C.
35-25 Art. 1.33C, Subsecs. (a), (b).)
35-26 (Sections 37.002 to 37.050 reserved for expansion
36-1 SUBCHAPTER B. CERTAIN PROCEEDINGS RELATING TO RATES
36-2 Sec. 37.051. STREAMLINED PROCEDURES. (a) The department
36-3 shall study and the commissioner may adopt and implement procedures
36-4 for streamlining insurance rate proceedings under this code or
36-5 another insurance law of this state. The procedures must ensure
36-6 due process to each affected party.
36-7 (b) The commissioner shall consider this section in adopting
36-8 rules under Section 37.001. (V.T.I.C. Art. 1.33C, Subsec. (c);
36-9 Art. 5.121.)
36-10 Sec. 37.052. ROLE OF DEPARTMENT. (a) The application of
36-11 this section is subject to Chapter 40.
36-12 (b) The commissioner may designate the general counsel or an
36-13 assistant general counsel to serve as a hearings officer in a
36-14 proceeding in which insurance rates are set or in a prehearing
36-15 proceeding. The commissioner must make the final decision relating
36-16 to the rates to be set.
36-17 (c) The department shall provide evidence in proceedings
36-18 before the commissioner or the designated hearings officer that
36-19 promotes the adoption of fair and reasonable rates for underserved
36-20 areas to promote access to full insurance coverage for those areas.
36-21 (d) The department may appear as a matter of right as a
36-22 party, present evidence, or question a witness in a proceeding
36-23 before the commissioner or the designated hearings officer in which
36-24 insurance rates are set under this code. This subsection expires
36-25 September 1, 2001. (V.T.I.C. Art. 1.09-5.)
37-1 CHAPTER 38. DATA COLLECTION AND REPORTS
37-2 SUBCHAPTER A. GENERAL PROVISIONS
37-3 Sec. 38.001. INQUIRIES
37-4 Sec. 38.002. UNDERWRITING GUIDELINES; CONFIDENTIALITY
37-5 (Sections 38.003 to 38.050 reserved for expansion
37-6 SUBCHAPTER B. HEALTH BENEFIT PLAN PROVIDER REPORTING
37-7 Sec. 38.051. DEFINITION
37-8 Sec. 38.052. REQUIRED INFORMATION; RULES
37-9 (Sections 38.053 to 38.100 reserved for expansion
37-10 SUBCHAPTER C. DATA COLLECTION AND REPORTING
37-11 RELATING TO HIV AND AIDS
37-12 Sec. 38.101. DEFINITIONS
37-13 Sec. 38.102. PURPOSE
37-14 Sec. 38.103. DATA COLLECTION PROGRAM
37-15 Sec. 38.104. COMPILATION OF DATA AND INFORMATION; REPORT
37-16 Sec. 38.105. RECOMMENDATIONS AND REPORTS TO LEGISLATURE
37-17 Sec. 38.106. INFORMATION CONFIDENTIAL
37-18 (Sections 38.107 to 38.150 reserved for expansion
37-19 SUBCHAPTER D. LIABILITY INSURANCE CLOSED CLAIM REPORTS
37-20 Sec. 38.151. DEFINITIONS
37-21 Sec. 38.152. EXEMPTION
37-22 Sec. 38.153. CLOSED CLAIM REPORT
37-23 Sec. 38.154. CONTENT OF CLOSED CLAIM REPORT FORM
37-24 Sec. 38.155. SUMMARY CLOSED CLAIM REPORT
37-25 Sec. 38.156. CONTENT OF SUMMARY CLOSED CLAIM REPORT FORM
37-26 Sec. 38.157. AGGREGATE REPORT
38-1 Sec. 38.158. ALTERNATIVE REPORTING
38-2 Sec. 38.159. COMPILATION OF DATA; REPORT
38-3 Sec. 38.160. ELECTRONIC DATABASE
38-4 Sec. 38.161. REPORT TO LEGISLATURE
38-5 Sec. 38.162. INFORMATION CONFIDENTIAL
38-6 Sec. 38.163. RULES AND FORMS
38-7 (Sections 38.164 to 38.200 reserved for expansion
38-8 SUBCHAPTER E. STATISTICAL DATA COLLECTION
38-9 Sec. 38.201. DEFINITION
38-10 Sec. 38.202. STATISTICAL AGENT
38-11 Sec. 38.203. QUALIFICATIONS OF STATISTICAL AGENT
38-12 Sec. 38.204. POWERS AND DUTIES OF STATISTICAL AGENT
38-13 Sec. 38.205. DUTY OF INSURER
38-14 Sec. 38.206. FEES
38-15 Sec. 38.207. RULES
38-16 CHAPTER 38. DATA COLLECTION AND REPORTS
38-17 SUBCHAPTER A. GENERAL PROVISIONS
38-18 Sec. 38.001. INQUIRIES. (a) In this section,
38-19 "authorization" means a permit, certificate of registration, or
38-20 other authorization issued or existing under this code.
38-21 (b) The department may address a reasonable inquiry to an
38-22 insurance company, agent, or holder of an authorization relating
38-23 to:
38-24 (1) the person's business condition; or
38-25 (2) any matter connected with the person's
38-26 transactions that the department considers necessary for the public
39-1 good or for the proper discharge of the department's duties.
39-2 (c) A person receiving an inquiry under Subsection (b) shall
39-3 respond to the inquiry in writing not later than the 10th day after
39-4 the date the inquiry is received.
39-5 (d) A response made under this section that is otherwise
39-6 privileged or confidential by law remains privileged or
39-7 confidential until introduced into evidence at an administrative
39-8 hearing or in a court. (V.T.I.C. Art. 1.24.)
39-9 Sec. 38.002. UNDERWRITING GUIDELINES; CONFIDENTIALITY.
39-10 (a) The department or the office of public insurance counsel may
39-11 obtain a copy of an insurer's underwriting guidelines.
39-12 (b) Underwriting guidelines are confidential, and the
39-13 department or the office of public insurance counsel may not make
39-14 the guidelines available to the public.
39-15 (c) The department or the office of public insurance counsel
39-16 may disclose to the public a summary of an insurer's underwriting
39-17 guidelines in a manner that does not directly or indirectly
39-18 identify the insurer.
39-19 (d) When underwriting guidelines are furnished to the
39-20 department or the office of public insurance counsel, only a person
39-21 within the department or the office of public insurance counsel
39-22 with a need to know may have access to the guidelines. The
39-23 department and the office of public insurance counsel shall
39-24 establish internal control systems to limit access to the
39-25 guidelines and shall keep records of the access provided.
39-26 (e) This section does not preclude the use of underwriting
40-1 guidelines as evidence in prosecuting a violation of this code.
40-2 Each copy of an insurer's underwriting guidelines that is used in
40-3 prosecuting a violation is presumed to be confidential and is
40-4 subject to a protective order until all appeals of the case have
40-5 been exhausted. If an insurer is found, after the exhaustion of
40-6 all appeals, to have violated this code, a copy of the underwriting
40-7 guidelines used as evidence of the violation is no longer presumed
40-8 to be confidential.
40-9 (f) A violation of this section is a violation of Chapter
40-10 552, Government Code. (V.T.I.C. Art. 1.24D.)
40-11 (Sections 38.003 to 38.050 reserved for expansion
40-12 SUBCHAPTER B. HEALTH BENEFIT PLAN PROVIDER REPORTING
40-13 Sec. 38.051. DEFINITION. In this subchapter, "health
40-14 benefit plan provider" means an insurance company, group hospital
40-15 service corporation, or health maintenance organization that
40-16 issues:
40-17 (1) an individual, group, blanket, or franchise
40-18 insurance policy, an insurance agreement, a group hospital service
40-19 contract, or an evidence of coverage, that provides benefits for
40-20 medical or surgical expenses incurred as a result of an accident or
40-21 sickness; or
40-22 (2) a long-term care insurance policy, as defined by
40-23 Section 2, Article 3.70-12. (V.T.I.C. Art. 3.90, Subsec. (a);
40-24 New.)
40-25 Sec. 38.052. REQUIRED INFORMATION; RULES. (a) A health
40-26 benefit plan provider shall submit information required by the
41-1 department relating to the health benefit plan provider's:
41-2 (1) loss experience;
41-3 (2) overhead; and
41-4 (3) operating expenses.
41-5 (b) The department may also request information about
41-6 characteristics of persons covered by a health benefit plan
41-7 provider, including information relating to:
41-8 (1) age;
41-9 (2) gender;
41-10 (3) health status;
41-11 (4) job classification; and
41-12 (5) geographic distribution.
41-13 (c) A health benefit plan provider may not be required to
41-14 submit information under this section more frequently than
41-15 annually.
41-16 (d) The commissioner shall adopt rules governing the
41-17 submission of information under this subchapter. (V.T.I.C.
41-18 Art. 3.90, Subsecs. (b), (c).)
41-19 (Sections 38.053 to 38.100 reserved for expansion
41-20 SUBCHAPTER C. DATA COLLECTION AND REPORTING
41-21 RELATING TO HIV AND AIDS
41-22 Sec. 38.101. DEFINITIONS. In this subchapter:
41-23 (1) "HIV" and "AIDS" have the meanings assigned by
41-24 Section 81.101, Health and Safety Code.
41-25 (2) "Health benefit plan coverage" means a group
41-26 policy, contract, or certificate of health insurance or benefits
42-1 delivered, issued for delivery, or renewed in this state by:
42-2 (A) an insurance company subject to Chapter 3;
42-3 (B) a group hospital service corporation under
42-4 Chapter 20;
42-5 (C) a health maintenance organization under the
42-6 Texas Health Maintenance Organization Act (Chapter 20A, Vernon's
42-7 Texas Insurance Code); or
42-8 (D) a self-insurance trust or mechanism
42-9 providing health care benefits. (V.T.I.C. Art. 1.24C, Subsecs.
42-10 (b)(1), (2).)
42-11 Sec. 38.102. PURPOSE. The purpose of this subchapter is to:
42-12 (1) ensure that adequate health insurance and benefits
42-13 coverage is available to the citizens of this state;
42-14 (2) ensure that adequate health care is available to
42-15 protect the public health and safety; and
42-16 (3) ascertain the continuing effect of HIV and AIDS on
42-17 health insurance coverage and health benefits coverage availability
42-18 and adequacy in this state for purposes of meeting the public's
42-19 health coverage needs. (V.T.I.C. Art. 1.24C, Subsec. (a).)
42-20 Sec. 38.103. DATA COLLECTION PROGRAM. (a) The department
42-21 shall maintain a program to gather data and information relating to
42-22 the effect of HIV and AIDS on the availability, adequacy, and
42-23 affordability of health benefit plan coverage in this state.
42-24 (b) The commissioner may adopt rules necessary to implement
42-25 this subchapter, including rules relating to:
42-26 (1) reporting schedules;
43-1 (2) report forms;
43-2 (3) lists of data and information required to be
43-3 reported; and
43-4 (4) reporting procedures, guidelines, and criteria.
43-5 (V.T.I.C. Art. 1.24C, Subsecs. (c), (d).)
43-6 Sec. 38.104. COMPILATION OF DATA AND INFORMATION; REPORT.
43-7 (a) The department shall compile the data and information included
43-8 in reports required by this subchapter into composite form and
43-9 shall prepare at least annually a written report of:
43-10 (1) the composite data and information; and
43-11 (2) the department's analysis of the availability,
43-12 adequacy, and affordability of health benefit plan coverage in this
43-13 state.
43-14 (b) Subject to Section 38.106, the department shall make the
43-15 report available to the public and may charge a reasonable fee for
43-16 the report to cover the cost of making the report available.
43-17 (V.T.I.C. Art. 1.24C, Subsec. (e).)
43-18 Sec. 38.105. RECOMMENDATIONS AND REPORTS TO LEGISLATURE.
43-19 (a) The commissioner may submit to the legislature written
43-20 recommendations for legislation the commissioner considers
43-21 necessary to resolve problems related to the effect of HIV and AIDS
43-22 on the availability, adequacy, and affordability of health benefit
43-23 plan coverage in this state.
43-24 (b) The department, on request of the lieutenant governor,
43-25 the speaker of the house of representatives, or the presiding
43-26 officer of a legislative committee, shall provide to the
44-1 legislature additional composite data and information and analyses
44-2 based on the reports required by this subchapter. Reports prepared
44-3 under this subsection shall be available to the public as required
44-4 by Section 38.104. (V.T.I.C. Art. 1.24C, Subsecs. (f), (g).)
44-5 Sec. 38.106. INFORMATION CONFIDENTIAL. (a) If the
44-6 commissioner determines that information or reports submitted under
44-7 this subchapter would reveal or might reveal the identity of an
44-8 individual or associate an individual with a company, the
44-9 commissioner shall declare the information or reports confidential,
44-10 and the information or reports may not be made available to the
44-11 public.
44-12 (b) Information made confidential under this section may be
44-13 examined only by the commissioner and department employees.
44-14 (c) Data and information reported by an insurer under this
44-15 subchapter are not subject to public disclosure to the extent that
44-16 the information is protected under Chapter 552, Government Code.
44-17 The data and information may be compiled into composite form and
44-18 made public if information that could be used to identify the
44-19 reporting insurer is removed. (V.T.I.C. Art. 1.24C, Subsecs. (h),
44-20 (i).)
44-21 (Sections 38.107 to 38.150 reserved for expansion
44-22 SUBCHAPTER D. LIABILITY INSURANCE CLOSED CLAIM REPORTS
44-23 Sec. 38.151. DEFINITIONS. In this subchapter:
44-24 (1) "Insurer" means:
44-25 (A) an insurance company or other entity that is
44-26 admitted to do business and authorized to write liability insurance
45-1 in this state, including:
45-2 (i) a county mutual insurance company;
45-3 (ii) a Lloyd's plan insurer; and
45-4 (iii) a reciprocal or interinsurance
45-5 exchange; and
45-6 (B) a pool, joint underwriting association, or
45-7 self-insurance mechanism or trust authorized by law to insure its
45-8 participants, subscribers, or members against liability.
45-9 (2) "Liability insurance" means:
45-10 (A) general liability insurance;
45-11 (B) medical professional liability insurance;
45-12 (C) professional liability insurance other than
45-13 medical professional liability insurance;
45-14 (D) commercial automobile liability insurance;
45-15 (E) the liability portion of commercial
45-16 multiperil insurance coverage; and
45-17 (F) any other type or line of liability
45-18 insurance designated by the commissioner under Section 38.163.
45-19 (V.T.I.C. Art. 1.24B, Secs. 1(1), (2) (part).)
45-20 Sec. 38.152. EXEMPTION. This subchapter does not apply to a
45-21 farm mutual insurance company or to a county mutual fire insurance
45-22 company writing exclusively industrial fire insurance as described
45-23 by Article 17.02. (V.T.I.C. Art. 1.24B, Sec. 1(2) (part).)
45-24 Sec. 38.153. CLOSED CLAIM REPORT. (a) Not later than the
45-25 10th day after the last day of the calendar quarter in which a
45-26 claim for recovery under a liability insurance policy is closed,
46-1 the insurer shall file with the department a closed claim report if
46-2 the indemnity payment for bodily injury under the coverage is
46-3 $25,000 or more.
46-4 (b) A closed claim report must be filed in a form prescribed
46-5 by the commissioner. (V.T.I.C. Art. 1.24B, Secs. 2(a), 5(a)
46-6 (part).)
46-7 Sec. 38.154. CONTENT OF CLOSED CLAIM REPORT FORM. (a) The
46-8 closed claim report form adopted by the commissioner for a report
46-9 under Section 38.153 must require information relating to:
46-10 (1) the identity of the insurer;
46-11 (2) the liability insurance policy, including:
46-12 (A) the type or types of insurance;
46-13 (B) the policy limits;
46-14 (C) whether the policy was an occurrence or
46-15 claims-made policy;
46-16 (D) the classification of the insured; and
46-17 (E) reserves for the claim;
46-18 (3) details of:
46-19 (A) any injury, damage, or other loss that was
46-20 the subject of the claim, including:
46-21 (i) the type of injury, damage, or other
46-22 loss;
46-23 (ii) where and how the injury, damage, or
46-24 other loss occurred;
46-25 (iii) the age of any injured party; and
46-26 (iv) whether an injury was work-related;
47-1 (B) the claims process, including:
47-2 (i) whether a lawsuit was filed;
47-3 (ii) where a lawsuit, if any, was filed;
47-4 (iii) whether attorneys were involved;
47-5 (iv) the stage at which the claim was
47-6 closed;
47-7 (v) any court verdict;
47-8 (vi) any appeal;
47-9 (vii) the number of defendants; and
47-10 (viii) whether the claim was settled
47-11 outside of court and, if so, at what stage; and
47-12 (C) the amount paid on the claim, including:
47-13 (i) the total amount of a court award;
47-14 (ii) the amount paid by the insurer;
47-15 (iii) any amount paid by another insurer;
47-16 (iv) any amount paid by another defendant;
47-17 (v) any collateral source of payment;
47-18 (vi) any structured settlement;
47-19 (vii) the amount of noneconomic
47-20 compensatory damages;
47-21 (viii) the amount of prejudgment interest;
47-22 (ix) the amount paid for defense costs;
47-23 (x) the amount paid for punitive damages;
47-24 and
47-25 (xi) the amount of allocated loss
47-26 adjustment expenses; and
48-1 (4) any other information that the commissioner
48-2 determines to be significant in allowing the department and the
48-3 legislature to monitor the liability insurance industry to ensure
48-4 its solvency and to ensure that liability insurance is available,
48-5 is affordable, and provides adequate protection in this state.
48-6 (b) The department may require an insurer to include in a
48-7 closed claim report information relating to payment made for
48-8 property damage and other damage on the claim under the coverage.
48-9 (V.T.I.C. Art. 1.24B, Secs. 2(b), 3.)
48-10 Sec. 38.155. SUMMARY CLOSED CLAIM REPORT. (a) An insurer
48-11 shall file with the department a summary closed claim report for a
48-12 claim for recovery under a liability insurance policy if the
48-13 indemnity payment for bodily injury under the coverage is less than
48-14 $25,000 but more than $10,000.
48-15 (b) A summary closed claim report must be filed, in a form
48-16 prescribed by the commissioner, not later than the 10th day after
48-17 the last day of the calendar quarter in which the claim is closed.
48-18 (V.T.I.C. Art. 1.24B, Secs. 2(c), 5(a) (part).)
48-19 Sec. 38.156. CONTENT OF SUMMARY CLOSED CLAIM REPORT FORM.
48-20 The summary closed claim report form adopted by the commissioner
48-21 for a report under Section 38.155 must require information
48-22 relating to:
48-23 (1) the identity of the insurer;
48-24 (2) the liability insurance policy, including:
48-25 (A) the type or types of insurance;
48-26 (B) the classification of the insured; and
49-1 (C) reserves for the claim;
49-2 (3) details of:
49-3 (A) the claims process, including:
49-4 (i) whether a lawsuit was filed;
49-5 (ii) whether attorneys were involved;
49-6 (iii) the stage at which the claim was
49-7 closed;
49-8 (iv) any court verdict;
49-9 (v) any appeal; and
49-10 (vi) whether the claim was settled outside
49-11 of court and, if so, at what stage; and
49-12 (B) the amount paid on the claim, including:
49-13 (i) the total amount of a court award;
49-14 (ii) the amount paid to the claimant by
49-15 the insurer;
49-16 (iii) the amount paid for defense costs;
49-17 (iv) the amount paid for punitive damages;
49-18 and
49-19 (v) the amount of loss adjustment
49-20 expenses; and
49-21 (4) any other matter that the commissioner determines
49-22 to be significant in allowing the department and the legislature to
49-23 monitor the liability insurance industry to ensure its solvency and
49-24 to ensure that liability insurance is available, is affordable, and
49-25 provides adequate protection in this state. (V.T.I.C. Art. 1.24B,
49-26 Sec. 4.)
50-1 Sec. 38.157. AGGREGATE REPORT. (a) An insurer shall file
50-2 with the department one report containing the information required
50-3 under this section for all claims closed within the calendar year
50-4 for which the indemnity payments for bodily injury under the
50-5 coverage are $10,000 or less, including claims for which an
50-6 indemnity payment is not made on closing.
50-7 (b) The report must include, in summary form, at least the
50-8 following information:
50-9 (1) the aggregate number of claims; and
50-10 (2) the aggregate dollar amount paid out.
50-11 (c) The report must be filed in a form and in a manner
50-12 prescribed by the commissioner. (V.T.I.C. Art. 1.24B, Sec. 2(d).)
50-13 Sec. 38.158. ALTERNATIVE REPORTING. After notice and public
50-14 hearing, the commissioner may provide for alternative reporting in
50-15 the form of sampling of the required closed claim data instead of
50-16 requiring insurers to file the closed claim data required by this
50-17 subchapter. (V.T.I.C. Art. 1.24B, Sec. 5(b).)
50-18 Sec. 38.159. COMPILATION OF DATA; REPORT. The department
50-19 shall compile the data included in individual closed claim reports
50-20 and summary closed claim reports into a composite form and shall
50-21 prepare annually a written report of the composite data. The
50-22 department shall make the report available to the public.
50-23 (V.T.I.C. Art. 1.24B, Secs. 6(a), (b) (part).)
50-24 Sec. 38.160. ELECTRONIC DATABASE. The commissioner may:
50-25 (1) establish an electronic database composed of
50-26 reports filed with the department under this subchapter;
51-1 (2) provide the public with access to that data;
51-2 (3) establish a system to provide access to that data
51-3 by electronic data transmittal processes; and
51-4 (4) set and charge a fee for electronic access to the
51-5 database in an amount reasonable and necessary to cover the costs
51-6 of access. (V.T.I.C. Art. 1.24B, Sec. 6(d).)
51-7 Sec. 38.161. REPORT TO LEGISLATURE. (a) The department
51-8 shall submit copies of the report required by Section 38.159 to the
51-9 presiding officers of each house of the legislature.
51-10 (b) The department, on request of the lieutenant governor,
51-11 the speaker of the house of representatives, or the presiding
51-12 officer of a legislative committee, shall provide to the
51-13 legislature additional composite data based on closed claim reports
51-14 and summary closed claim reports. Reports prepared under this
51-15 subsection shall be available to the public. (V.T.I.C. Art. 1.24B,
51-16 Secs. 6(b) (part), (c).)
51-17 Sec. 38.162. INFORMATION CONFIDENTIAL. (a) Information
51-18 included in an individual closed claim report or an individual
51-19 summary closed claim report submitted by an insurer under this
51-20 subchapter is confidential and may not be made available by the
51-21 department to the public.
51-22 (b) Information included in an individual closed claim
51-23 report or an individual summary closed claim report may be examined
51-24 only by the commissioner and department employees. (V.T.I.C.
51-25 Art. 1.24B, Sec. 7.)
51-26 Sec. 38.163. RULES AND FORMS. The commissioner may adopt
52-1 necessary rules to:
52-2 (1) implement this subchapter;
52-3 (2) define terminology, criteria, content, and other
52-4 matters relating to the reports required under this subchapter; and
52-5 (3) designate other types or lines of liability
52-6 insurance required to provide information under this subchapter.
52-7 (V.T.I.C. Art. 1.24B, Sec. 5(a) (part).)
52-8 (Sections 38.164 to 38.200 reserved for expansion
52-9 SUBCHAPTER E. STATISTICAL DATA COLLECTION
52-10 Sec. 38.201. DEFINITION. In this subchapter, "designated
52-11 statistical agent" means an organization designated or contracted
52-12 with by the commissioner under Section 38.202. (New.)
52-13 Sec. 38.202. STATISTICAL AGENT. The commissioner may, for a
52-14 line or subline of insurance, designate or contract with a
52-15 qualified organization to serve as the statistical agent for the
52-16 commissioner to gather data relevant for regulatory purposes or as
52-17 otherwise provided by this code. (V.T.I.C. Art. 21.69, Subsec.
52-18 (a).)
52-19 Sec. 38.203. QUALIFICATIONS OF STATISTICAL AGENT. To
52-20 qualify as a statistical agent, an organization must demonstrate at
52-21 least five years of experience in data collection, data
52-22 maintenance, data quality control, accounting, and related areas.
52-23 (V.T.I.C. Art. 21.69, Subsec. (b).)
52-24 Sec. 38.204. POWERS AND DUTIES OF STATISTICAL AGENT. (a) A
52-25 designated statistical agent shall collect data from reporting
52-26 insurers under a statistical plan adopted by the commissioner.
53-1 (b) The statistical agent may provide aggregate historical
53-2 premium and loss data to its subscribers. (V.T.I.C. Art. 21.69,
53-3 Subsecs. (d), (f).)
53-4 Sec. 38.205. DUTY OF INSURER. An insurer shall provide all
53-5 premium and loss cost data to the commissioner or the designated
53-6 statistical agent as the commissioner or agent requires. (V.T.I.C.
53-7 Art. 21.69, Subsec. (e).)
53-8 Sec. 38.206. FEES. (a) A designated statistical agent may
53-9 collect from a reporting insurer any fees necessary for the agent
53-10 to recover the necessary and reasonable costs of collecting data
53-11 from that reporting insurer.
53-12 (b) A reporting insurer shall pay the fee to the statistical
53-13 agent for the data collection services provided by the statistical
53-14 agent. (V.T.I.C. Art. 21.69, Subsec. (c).)
53-15 Sec. 38.207. RULES. The commissioner may adopt rules
53-16 necessary to accomplish the purposes of this subchapter. (V.T.I.C.
53-17 Art. 21.69, Subsec. (g).)
53-18 CHAPTER 39. PUBLIC ACCESS
53-19 Sec. 39.001. ACCESS TO PROGRAMS AND FACILITIES
53-20 Sec. 39.002. PUBLIC COMMENT
53-21 Sec. 39.003. PUBLIC REPRESENTATION ON ADVISORY BODY
53-22 CHAPTER 39. PUBLIC ACCESS
53-23 Sec. 39.001. ACCESS TO PROGRAMS AND FACILITIES. (a) The
53-24 commissioner shall prepare and maintain a written plan that
53-25 describes how a person who does not speak English may be provided
53-26 reasonable access to the department's programs.
54-1 (b) The department shall comply with federal and state laws
54-2 for program and facility accessibility. (V.T.I.C. Art. 1.04C,
54-3 Subsec. (a).)
54-4 Sec. 39.002. PUBLIC COMMENT. The commissioner shall develop
54-5 and implement policies that provide the public with a reasonable
54-6 opportunity to appear before the commissioner and to speak on any
54-7 issue under the jurisdiction of the commissioner. (V.T.I.C.
54-8 Art. 1.04C, Subsec. (b).)
54-9 Sec. 39.003. PUBLIC REPRESENTATION ON ADVISORY BODY.
54-10 (a) At least one-half of the membership of each advisory body
54-11 appointed by the commissioner, other than an advisory body whose
54-12 membership is determined by this code or by another law relating to
54-13 the business of insurance in this state, must represent the general
54-14 public.
54-15 (b) A public representative may not be:
54-16 (1) an officer, director, or employee of an insurance
54-17 company, insurance agency, agent, broker, solicitor, adjuster, or
54-18 any other business entity regulated by the department;
54-19 (2) a person required to register with the Texas
54-20 Ethics Commission under Chapter 305, Government Code; or
54-21 (3) a person related within the second degree by
54-22 affinity or consanguinity to a person described by Subdivision (1)
54-23 or (2). (V.T.I.C. Art. 1.35C.)
55-1 CHAPTER 40. DUTIES OF STATE OFFICE OF ADMINISTRATIVE
55-2 HEARINGS AND COMMISSIONER IN CERTAIN PROCEEDINGS;
55-3 RATE SETTING PROCEEDINGS
55-4 SUBCHAPTER A. GENERAL PROVISIONS
55-5 Sec. 40.001. DEFINITION
55-6 Sec. 40.002. DUTIES OF STATE OFFICE OF ADMINISTRATIVE
55-7 HEARINGS
55-8 Sec. 40.003. APPLICATION OF CHAPTER; EXCEPTIONS
55-9 Sec. 40.004. MEMORANDUM OF UNDERSTANDING
55-10 Sec. 40.005. CONFLICT WITH OTHER LAW
55-11 (Sections 40.006 to 40.050 reserved for expansion
55-12 SUBCHAPTER B. PROCEEDINGS RELATING TO PROMULGATION OF RATES
55-13 Sec. 40.051. APPLICATION OF SUBCHAPTER
55-14 Sec. 40.052. APPLICATION OF ADMINISTRATIVE PROCEDURE ACT
55-15 Sec. 40.053. PRESENTATION OF EVIDENCE
55-16 Sec. 40.054. WITNESSES AND CROSS-EXAMINATION
55-17 Sec. 40.055. TESTIMONY OF EXPERT WITNESS; PREFILING
55-18 REQUIRED
55-19 Sec. 40.056. DEADLINES
55-20 Sec. 40.057. INFLUENCE OF COMMISSIONER PROHIBITED
55-21 Sec. 40.058. PROPOSAL FOR DECISION
55-22 Sec. 40.059. CONSIDERATION OF PROPOSAL FOR DECISION
55-23 Sec. 40.060. COMMISSIONER'S ORDER
56-1 CHAPTER 40. DUTIES OF STATE OFFICE OF ADMINISTRATIVE
56-2 HEARINGS AND COMMISSIONER IN CERTAIN PROCEEDINGS;
56-3 RATE SETTING PROCEEDINGS
56-4 SUBCHAPTER A. GENERAL PROVISIONS
56-5 Sec. 40.001. DEFINITION. In this chapter, "office" means
56-6 the State Office of Administrative Hearings. (New; V.T.I.C.
56-7 Art. 1.33B, Subsec. (b) (part).)
56-8 Sec. 40.002. DUTIES OF STATE OFFICE OF ADMINISTRATIVE
56-9 HEARINGS. The office shall conduct an administrative hearing
56-10 required to be held or that may be held under this code or another
56-11 insurance law of this state. (V.T.I.C. Art. 1.33B, Subsec. (b)
56-12 (part).)
56-13 Sec. 40.003. APPLICATION OF CHAPTER; EXCEPTIONS. (a) This
56-14 chapter applies only to a hearing required to be held before a
56-15 decision may be rendered or action taken by the commissioner or the
56-16 department.
56-17 (b) If a provision of this code or another insurance law of
56-18 this state requires that the commissioner take an action at a
56-19 hearing subject to this chapter, the commissioner shall take the
56-20 action after receipt of a proposal for decision from the office
56-21 regarding the hearing conducted by the office.
56-22 (c) This chapter does not apply to a proceeding conducted
56-23 under Article 1.04D or to a proceeding relating to:
56-24 (1) approving or reviewing rates or rating manuals
56-25 filed by an individual company, unless the rates or manuals are
56-26 contested;
57-1 (2) adopting a rule;
57-2 (3) adopting or approving a policy form or policy form
57-3 endorsement; or
57-4 (4) adopting or approving a plan of operation for an
57-5 organization subject to the jurisdiction of the department.
57-6 (V.T.I.C. Art. 1.33B, Subsecs. (a), (b) (part), (e).)
57-7 Sec. 40.004. MEMORANDUM OF UNDERSTANDING. (a) The
57-8 commissioner and the chief administrative law judge of the office
57-9 by rule shall adopt a memorandum of understanding governing
57-10 hearings conducted by the office under this code or another
57-11 insurance law of this state.
57-12 (b) The memorandum of understanding must require the chief
57-13 administrative law judge and the commissioner to cooperate in
57-14 conducting hearings under this chapter and may authorize the office
57-15 to perform any procedural act, including giving notice, that is
57-16 required to be performed by the commissioner under this code or
57-17 another insurance law of this state. (V.T.I.C. Art. 1.33B, Subsec.
57-18 (d).)
57-19 Sec. 40.005. CONFLICT WITH OTHER LAW. This chapter prevails
57-20 over another provision of this code or another insurance law of
57-21 this state unless the provision or other law states that this
57-22 chapter does not apply. (V.T.I.C. Art. 1.33B, Subsec. (f).)
57-23 (Sections 40.006 to 40.050 reserved for expansion
57-24 SUBCHAPTER B. PROCEEDINGS RELATING TO PROMULGATION OF
57-25 RATES
57-26 Sec. 40.051. APPLICATION OF SUBCHAPTER. Subject to Section
58-1 40.003, a proceeding to promulgate rates is governed by this
58-2 subchapter. (V.T.I.C. Art. 1.33B, Subsec. (c)(1) (part).)
58-3 Sec. 40.052. APPLICATION OF ADMINISTRATIVE PROCEDURE ACT. A
58-4 proceeding to promulgate rates is a contested case under Chapter
58-5 2001, Government Code, and to the extent not inconsistent with this
58-6 subchapter, that chapter and the Texas Rules of Civil Procedure
58-7 apply. (V.T.I.C. Art. 1.33B, Subsec. (c)(1) (part).)
58-8 Sec. 40.053. PRESENTATION OF EVIDENCE. The administrative
58-9 law judge shall provide each interested party an opportunity to
58-10 respond to and present evidence and argument concerning all issues
58-11 in the proceeding. (V.T.I.C. Art. 1.33B, Subsec. (c)(2) (part).)
58-12 Sec. 40.054. WITNESSES AND CROSS-EXAMINATION. (a) The
58-13 testimony of a witness, other than an expert witness, may be
58-14 presented either orally by the witness at the hearing or by
58-15 affidavit.
58-16 (b) Each party is entitled to cross-examine each witness
58-17 called to testify by another party to the proceeding. The
58-18 attendance of a witness providing testimony by affidavit is
58-19 required if a party files a written request that the witness appear
58-20 for cross-examination.
58-21 (c) If a witness providing testimony by affidavit fails to
58-22 appear for cross-examination after the filing of a written request
58-23 that the witness appear, the administrative law judge shall exclude
58-24 the affidavit from evidence and may not consider the affidavit for
58-25 any purpose. (V.T.I.C. Art. 1.33B, Subsec. (c)(2) (part).)
58-26 Sec. 40.055. TESTIMONY OF EXPERT WITNESS; PREFILING
59-1 REQUIRED. The direct testimony of each expert witness to be called
59-2 must be prefiled in accordance with a schedule established by the
59-3 administrative law judge. (V.T.I.C. Art. 1.33B, Subsec. (c)(2)
59-4 (part).)
59-5 Sec. 40.056. DEADLINES. The administrative law judge shall
59-6 establish reasonable deadlines for the filing of affidavits, the
59-7 designation of witnesses, and other matters as are necessary or
59-8 appropriate. (V.T.I.C. Art. 1.33B, Subsec. (c)(2) (part).)
59-9 Sec. 40.057. INFLUENCE OF COMMISSIONER PROHIBITED. The
59-10 commissioner may not attempt to influence the administrative law
59-11 judge's findings of fact, conclusions of law, or application of the
59-12 law to the facts. (V.T.I.C. Art. 1.33B, Subsec. (c)(3).)
59-13 Sec. 40.058. PROPOSAL FOR DECISION. The administrative law
59-14 judge shall:
59-15 (1) prepare a proposal for decision that includes
59-16 proposed findings of fact and conclusions of law; and
59-17 (2) serve the proposal for decision by registered mail
59-18 on each party to the proceeding. (V.T.I.C. Art. 1.33B, Subsec.
59-19 (c)(4) (part).)
59-20 Sec. 40.059. CONSIDERATION OF PROPOSAL FOR DECISION.
59-21 (a) The commissioner shall provide to each party an opportunity to
59-22 file exceptions to the proposal for decision and briefs related to
59-23 the issues addressed in the proposal.
59-24 (b) After the opportunity to file exceptions and briefs
59-25 under Subsection (a), the commissioner shall, in open meeting,
59-26 consider:
60-1 (1) the proposal for decision; and
60-2 (2) the exceptions, briefs, and arguments of the
60-3 parties.
60-4 (c) The commissioner may amend the proposal for decision,
60-5 including any finding of fact. The commissioner shall accompany
60-6 any amendment with an explanation of the basis of the amendment.
60-7 The commissioner shall base any amendment and the order adopting
60-8 the rate solely on the record made before the administrative law
60-9 judge.
60-10 (d) The commissioner may refer the matter back to the
60-11 administrative law judge to:
60-12 (1) reconsider findings and conclusions in the
60-13 proposal for decision;
60-14 (2) take additional evidence; or
60-15 (3) make additional findings of fact or conclusions of
60-16 law. (V.T.I.C. Art. 1.33B, Subsecs. (c)(4) (part), (5) (part).)
60-17 Sec. 40.060. COMMISSIONER'S ORDER. The commissioner shall
60-18 serve on each party a copy of the commissioner's order, including
60-19 the commissioner's findings of fact and conclusions of law.
60-20 (V.T.I.C. Art. 1.33B, Subsec. (c)(5) (part).)
60-21 (Chapters 41 to 80 reserved for expansion
60-22 SUBTITLE B. DISCIPLINE AND ENFORCEMENT
60-23 CHAPTER 81. GENERAL PROVISIONS REGARDING
60-24 DISCIPLINE AND ENFORCEMENT
60-25 Sec. 81.001. LIMITATIONS PERIOD FOR CERTAIN DISCIPLINARY
60-26 ACTIONS
61-1 Sec. 81.002. NOTICE OF CERTAIN ORDERS AND DECISIONS
61-2 Sec. 81.003. NOTIFICATION OF CERTAIN DISCIPLINARY ACTIONS
61-3 OCCURRING IN OTHER STATES; CIVIL PENALTY
61-4 Sec. 81.004. REPORT TO ATTORNEY GENERAL
61-5 CHAPTER 81. GENERAL PROVISIONS REGARDING
61-6 DISCIPLINE AND ENFORCEMENT
61-7 Sec. 81.001. LIMITATIONS PERIOD FOR CERTAIN DISCIPLINARY
61-8 ACTIONS. (a) Except as provided by Subsection (b), the department
61-9 or commissioner may not begin an action to impose a sanction,
61-10 penalty, or fine, including an administrative penalty, against an
61-11 insurer, agent, or other license holder who is subject to the
61-12 jurisdiction of the department for conduct that is a violation of
61-13 this code or another insurance law of this state after the earlier
61-14 of:
61-15 (1) the fifth anniversary of the date on which the
61-16 conduct that is a violation occurred; or
61-17 (2) the second anniversary of the earlier of:
61-18 (A) the date on which the conduct that is a
61-19 violation is first discovered by the department; or
61-20 (B) the date on which the conduct that is a
61-21 violation is made known to the department.
61-22 (b) The department or commissioner may not begin an action
61-23 to impose a sanction, penalty, or fine, including an administrative
61-24 penalty, against an insurer, agent, or other license holder who is
61-25 subject to the jurisdiction of the department for conduct that is a
61-26 violation of this code or another insurance law of this state and
62-1 that involves fraud by the insurer, agent, or license holder after
62-2 the fifth anniversary of the earlier of:
62-3 (1) the date on which the conduct that is a violation
62-4 is first discovered by the department; or
62-5 (2) the date on which the conduct that is a violation
62-6 is made known to the department.
62-7 (c) This section does not apply to conduct that is a
62-8 violation that is ongoing at the time the department seeks to
62-9 impose the sanction, penalty, or fine. (V.T.I.C. Art. 1.41.)
62-10 Sec. 81.002. NOTICE OF CERTAIN ORDERS AND DECISIONS.
62-11 Notwithstanding Section 2001.142, Government Code, in a contested
62-12 case before the department or the commissioner the department shall
62-13 mail to each party and the party's attorney of record, by certified
62-14 mail, return receipt requested, a copy of the department's or
62-15 commissioner's written decision or order in that case. (V.T.I.C.
62-16 Art. 1.10B.)
62-17 Sec. 81.003. NOTIFICATION OF CERTAIN DISCIPLINARY ACTIONS
62-18 OCCURRING IN OTHER STATES; CIVIL PENALTY. (a) In this section,
62-19 "insurer" means any organization, corporation, or other person that
62-20 transacts insurance business, other than an organization,
62-21 corporation, or other person that is specifically made exempt from
62-22 this section by a reference to this section, without regard to
62-23 whether the organization, corporation, or other person is listed in
62-24 this subsection. The term includes:
62-25 (1) a capital stock company;
62-26 (2) a title insurance company;
63-1 (3) a reciprocal or interinsurance exchange;
63-2 (4) a Lloyd's plan insurer;
63-3 (5) a fraternal benefit society;
63-4 (6) a mutual company, including a mutual assessment
63-5 company;
63-6 (7) a statewide mutual assessment company;
63-7 (8) a local mutual aid association;
63-8 (9) a burial association;
63-9 (10) a county mutual insurance company;
63-10 (11) a farm mutual insurance company; and
63-11 (12) a fidelity, guaranty, or surety company.
63-12 (b) An insurer shall notify the commissioner and shall
63-13 deliver a copy of any applicable order or judgment to the
63-14 commissioner not later than the 30th day after the date of the:
63-15 (1) suspension or revocation of the insurer's right to
63-16 transact business in another state;
63-17 (2) receipt of an order to show cause why the
63-18 insurer's license in another state should not be suspended or
63-19 revoked; or
63-20 (3) imposition of a penalty, forfeiture, or sanction
63-21 on the insurer for a violation of the insurance laws of another
63-22 state.
63-23 (c) An insurer who violates Subsection (b) is liable for a
63-24 civil penalty, recoverable by a civil action, in an amount not to
63-25 exceed $500 for each violation. In addition to the civil penalty,
63-26 the commissioner may suspend or revoke the license of an insurer or
64-1 agent for a wilful violation of Subsection (b). (V.T.I.C.
64-2 Art. 1.30, Secs. 1(a) (part), 2, 3.)
64-3 Sec. 81.004. REPORT TO ATTORNEY GENERAL. The department
64-4 shall report to the attorney general, promptly and in detail, any
64-5 violation of law relating to insurance companies or the business of
64-6 insurance. (V.T.I.C. Art. 1.10, Sec. 8.)
64-7 CHAPTER 82. SANCTIONS
64-8 SUBCHAPTER A. GENERAL PROVISIONS
64-9 Sec. 82.001. DEFINITION
64-10 Sec. 82.002. APPLICATION OF CHAPTER
64-11 Sec. 82.003. PROCEEDINGS UNDER OTHER LAW
64-12 (Sections 82.004 to 82.050 reserved for expansion
64-13 SUBCHAPTER B. IMPOSITION OF SANCTIONS
64-14 Sec. 82.051. CANCELLATION OR REVOCATION OF
64-15 AUTHORIZATION
64-16 Sec. 82.052. OTHER SANCTIONS
64-17 Sec. 82.053. RESTITUTION
64-18 Sec. 82.054. CANCELLATION ON FAILURE TO COMPLY
64-19 Sec. 82.055. INFORMAL DISPOSITION
64-20 Sec. 82.056. NOTICE TO OTHER STATES
64-21 CHAPTER 82. SANCTIONS
64-22 SUBCHAPTER A. GENERAL PROVISIONS
64-23 Sec. 82.001. DEFINITION. In this chapter, "authorization"
64-24 means a permit, license, certificate of authority, certificate of
64-25 registration, or other authorization issued or existing under the
64-26 commissioner's authority or this code. (V.T.I.C. Art. 1.10, Sec.
65-1 7(a) (part); New.)
65-2 Sec. 82.002. APPLICATION OF CHAPTER. (a) This chapter
65-3 applies to each company regulated by the commissioner, including:
65-4 (1) a domestic or foreign, stock or mutual, life,
65-5 health, or accident insurance company;
65-6 (2) a domestic or foreign, stock or mutual, fire or
65-7 casualty insurance company;
65-8 (3) a Mexican casualty company;
65-9 (4) a domestic or foreign Lloyd's plan insurer;
65-10 (5) a domestic or foreign reciprocal or interinsurance
65-11 exchange;
65-12 (6) a domestic or foreign fraternal benefit society;
65-13 (7) a domestic or foreign title insurance company;
65-14 (8) an attorney's title insurance company;
65-15 (9) a stipulated premium insurance company;
65-16 (10) a nonprofit legal service corporation;
65-17 (11) a health maintenance organization;
65-18 (12) a statewide mutual assessment company;
65-19 (13) a local mutual aid association;
65-20 (14) a local mutual burial association;
65-21 (15) an association exempt under Article 14.17;
65-22 (16) a nonprofit hospital, medical, or dental service
65-23 corporation, including a company subject to Chapter 20;
65-24 (17) a county mutual insurance company; and
65-25 (18) a farm mutual insurance company.
65-26 (b) This chapter also applies to:
66-1 (1) an agent of an entity described by Subsection (a);
66-2 and
66-3 (2) a person who:
66-4 (A) is engaged in the business of insurance;
66-5 (B) holds an authorization; or
66-6 (C) is regulated by the commissioner.
66-7 (c) The commissioner's authority under this chapter applies
66-8 to each form of authorization and each person holding an
66-9 authorization. (V.T.I.C. Art. 1.10, Secs. 7(f) (part), (g).)
66-10 Sec. 82.003. PROCEEDINGS UNDER OTHER LAW. The
66-11 commissioner's authority under this chapter is in addition to any
66-12 other authority to enforce a sanction, penalty, fine, forfeiture,
66-13 denial, suspension, or revocation otherwise authorized by law.
66-14 (V.T.I.C. Art. 1.10, Sec. 7(f) (part).)
66-15 (Sections 82.004 to 82.050 reserved for expansion
66-16 SUBCHAPTER B. IMPOSITION OF SANCTIONS
66-17 Sec. 82.051. CANCELLATION OR REVOCATION OF AUTHORIZATION.
66-18 After notice and opportunity for a hearing, the commissioner may
66-19 cancel or revoke an authorization if the holder of the
66-20 authorization is found to be in violation of, or to have failed to
66-21 comply with, this code or a rule of the commissioner. (V.T.I.C.
66-22 Art. 1.10, Sec. 7(a) (part).)
66-23 Sec. 82.052. OTHER SANCTIONS. In addition to the
66-24 cancellation or revocation of an authorization under Section
66-25 82.051, the commissioner may:
66-26 (1) suspend the authorization for a specified time not
67-1 to exceed one year;
67-2 (2) order the holder of the authorization to cease and
67-3 desist from:
67-4 (A) the activity determined to be in violation
67-5 of this code or a rule of the commissioner; or
67-6 (B) the failure to comply with this code or a
67-7 rule of the commissioner;
67-8 (3) direct the holder of the authorization to pay an
67-9 administrative penalty under Chapter 84;
67-10 (4) direct the holder of the authorization to make
67-11 restitution under Section 82.053; or
67-12 (5) take any combination of those actions. (V.T.I.C.
67-13 Art. 1.10, Sec. 7(a) (part).)
67-14 Sec. 82.053. RESTITUTION. (a) The commissioner may direct
67-15 the holder of an authorization to make complete restitution to each
67-16 Texas resident, each Texas insured, and each entity operating in
67-17 this state that is harmed by a violation of, or failure to comply
67-18 with, this code or a rule of the commissioner.
67-19 (b) The holder of the authorization shall make the
67-20 restitution in the form and amount and within the period determined
67-21 by the commissioner. (V.T.I.C. Art. 1.10, Secs. 7(a) (part), (b).)
67-22 Sec. 82.054. CANCELLATION ON FAILURE TO COMPLY. If it is
67-23 found after hearing that a holder of an authorization has failed to
67-24 comply with an order issued under Section 82.052, the commissioner
67-25 shall cancel each authorization held by the holder. (V.T.I.C.
67-26 Art. 1.10, Sec. 7(c).)
68-1 Sec. 82.055. INFORMAL DISPOSITION. (a) The commissioner
68-2 may informally dispose of a matter under this subchapter by consent
68-3 order, agreed settlement, stipulation, or default.
68-4 (b) An informal disposition may include a provision under
68-5 which the holder of the authorization agrees to a sanction under
68-6 this subchapter with the express reservation that:
68-7 (1) the holder does not admit a violation of this code
68-8 or of a rule; and
68-9 (2) the existence of a violation is in dispute.
68-10 (V.T.I.C. Art. 1.10, Sec. 7(d).)
68-11 Sec. 82.056. NOTICE TO OTHER STATES. The commissioner shall
68-12 give notice of an action taken under this subchapter to the
68-13 insurance commissioner or other similar officer of each state.
68-14 (V.T.I.C. Art. 1.10, Sec. 7(e).)
68-15 CHAPTER 83. EMERGENCY CEASE AND DESIST ORDERS
68-16 SUBCHAPTER A. GENERAL PROVISIONS
68-17 Sec. 83.001. DEFINITIONS
68-18 Sec. 83.002. APPLICATION OF CHAPTER
68-19 Sec. 83.003. RULES
68-20 Sec. 83.004. PROCEEDINGS UNDER OTHER LAW
68-21 (Sections 83.005 to 83.050 reserved for expansion
68-22 SUBCHAPTER B. ISSUANCE OF ORDERS
68-23 Sec. 83.051. AUTHORITY OF COMMISSIONER TO ISSUE ORDER
68-24 Sec. 83.052. NOTICE
68-25 Sec. 83.053. REQUEST FOR HEARING
68-26 Sec. 83.054. HEARING
69-1 Sec. 83.055. EFFECT OF ORDER PENDING HEARING
69-2 (Sections 83.056 to 83.100 reserved for expansion
69-3 SUBCHAPTER C. ENFORCEMENT
69-4 Sec. 83.101. AUTHORITY OF COMMISSIONER
69-5 Sec. 83.102. DETERMINATION OF VIOLATION
69-6 Sec. 83.103. HEARING ON ADMINISTRATIVE PENALTY
69-7 Sec. 83.104. IMPOSITION OF ADMINISTRATIVE PENALTY;
69-8 RESTITUTION
69-9 Sec. 83.105. FAILURE TO PAY PENALTY
69-10 (Sections 83.106 to 83.150 reserved for expansion
69-11 SUBCHAPTER D. JUDICIAL REVIEW; JUDICIAL ACTION
69-12 Sec. 83.151. APPEAL
69-13 Sec. 83.152. EFFECT OF PETITION ON ORDER OR RELATED DECISION
69-14 Sec. 83.153. JUDICIAL ACTION FOR ENFORCEMENT OF ORDER;
69-15 ATTORNEY'S FEES
69-16 CHAPTER 83. EMERGENCY CEASE AND DESIST ORDERS
69-17 SUBCHAPTER A. GENERAL PROVISIONS
69-18 Sec. 83.001. DEFINITIONS. In this chapter:
69-19 (1) "Authorized person" means an individual or entity
69-20 described by Section 83.002.
69-21 (2) "Emergency" means a sudden, urgent occurrence that
69-22 requires immediate action.
69-23 (3) "Unauthorized person" means a person who directly
69-24 or indirectly does an act of insurance business that is:
69-25 (A) described by Section 101.051 or 101.052; and
69-26 (B) not done in accordance with specific
70-1 authorization of law.
70-2 (4) "Unfair act" means an unfair method of
70-3 competition, an unfair or deceptive act or practice, or an unfair
70-4 claim settlement practice as defined under Article 21.21 or 21.21-2
70-5 or a rule adopted under either article. (V.T.I.C. Art. 1.10A,
70-6 Secs. 1(1) (part), (2), (5), 2 (part); New.)
70-7 Sec. 83.002. APPLICATION OF CHAPTER. (a) This chapter
70-8 applies to each company regulated by the commissioner, including:
70-9 (1) a domestic or foreign, stock or mutual, life,
70-10 health, or accident insurance company;
70-11 (2) a domestic or foreign, stock or mutual, fire or
70-12 casualty insurance company;
70-13 (3) a Mexican casualty company;
70-14 (4) a domestic or foreign Lloyd's plan insurer;
70-15 (5) a domestic or foreign reciprocal or interinsurance
70-16 exchange;
70-17 (6) a domestic or foreign fraternal benefit society;
70-18 (7) a domestic or foreign title insurance company;
70-19 (8) an attorney's title insurance company;
70-20 (9) a stipulated premium insurance company;
70-21 (10) a nonprofit legal service corporation;
70-22 (11) a statewide mutual assessment company;
70-23 (12) a local mutual aid association;
70-24 (13) a local mutual burial association;
70-25 (14) an association exempt under Article 14.17;
70-26 (15) a nonprofit hospital, medical, or dental service
71-1 corporation, including a company subject to Chapter 20;
71-2 (16) a county mutual insurance company; and
71-3 (17) a farm mutual insurance company.
71-4 (b) This chapter also applies to:
71-5 (1) an agent of an entity described by Subsection (a);
71-6 and
71-7 (2) a person who:
71-8 (A) is engaged in the business of insurance;
71-9 (B) holds a permit, certificate, registration,
71-10 license, or other authority under this code; or
71-11 (C) is regulated by the commissioner. (V.T.I.C.
71-12 Art. 1.10A, Sec. 1(1) (part).)
71-13 Sec. 83.003. RULES. The commissioner may adopt reasonable
71-14 rules to implement this chapter, including rules that provide, to
71-15 the extent possible, uniformity of procedures between this state
71-16 and other states, the United States, or the National Association of
71-17 Insurance Commissioners. (V.T.I.C. Art. 1.10A, Sec. 6.)
71-18 Sec. 83.004. PROCEEDINGS UNDER OTHER LAW. The commissioner
71-19 may proceed solely under this chapter or under this chapter in
71-20 conjunction with other applicable law. (V.T.I.C. Art. 1.10A, Sec.
71-21 7.)
71-22 (Sections 83.005 to 83.050 reserved for expansion
71-23 SUBCHAPTER B. ISSUANCE OF ORDERS
71-24 Sec. 83.051. AUTHORITY OF COMMISSIONER TO ISSUE ORDER.
71-25 (a) The commissioner ex parte may issue an emergency cease and
71-26 desist order if:
72-1 (1) the commissioner believes that:
72-2 (A) an authorized person engaging in the
72-3 business of insurance is:
72-4 (i) committing an unfair act; or
72-5 (ii) in a hazardous condition or a
72-6 hazardous financial condition under Section 19, Texas Health
72-7 Maintenance Organization Act (Article 20A.19, Vernon's Texas
72-8 Insurance Code), or Article 1.32, as determined by the
72-9 commissioner; or
72-10 (B) an unauthorized person:
72-11 (i) is engaging in the business of
72-12 insurance in violation of Chapter 101 or in violation of a rule
72-13 adopted under that chapter; or
72-14 (ii) is engaging in the business of
72-15 insurance in violation of Chapter 101 and is committing an unfair
72-16 act; and
72-17 (2) it appears to the commissioner that the alleged
72-18 conduct:
72-19 (A) is fraudulent;
72-20 (B) is hazardous or creates an immediate danger
72-21 to the public safety; or
72-22 (C) is causing or can be reasonably expected to
72-23 cause public injury that:
72-24 (i) is likely to occur at any moment;
72-25 (ii) is incapable of being repaired or
72-26 rectified; and
73-1 (iii) has or is likely to have influence
73-2 or effect.
73-3 (b) An order is final on the 31st day after the date it is
73-4 received, unless the affected person requests a hearing under
73-5 Section 83.053. (V.T.I.C. Art. 1.10A, Secs. 1(6), (7), (8), 2
73-6 (part), 3(j).)
73-7 Sec. 83.052. NOTICE. (a) On issuance of an order under
73-8 Section 83.051, the commissioner shall serve on the affected person
73-9 an order that:
73-10 (1) contains a statement of the charges; and
73-11 (2) requires the person immediately to cease and
73-12 desist from the acts, methods, or practices stated in the order.
73-13 (b) The commissioner shall serve the order by registered or
73-14 certified mail, return receipt requested, to the affected person's
73-15 last known address. (V.T.I.C. Art. 1.10A, Sec. 3(a).)
73-16 Sec. 83.053. REQUEST FOR HEARING. (a) A person affected by
73-17 an order is entitled to request a hearing to contest the order.
73-18 (b) The affected person must request the hearing not later
73-19 than the 30th day after the date on which the person receives the
73-20 order required by Section 83.052.
73-21 (c) A request to contest an order must:
73-22 (1) be in writing;
73-23 (2) be directed to the commissioner; and
73-24 (3) state the grounds for the request to set aside or
73-25 modify the order. (V.T.I.C. Art. 1.10A, Sec. 3(b).)
73-26 Sec. 83.054. HEARING. (a) On receiving a request for a
74-1 hearing under Section 83.053, the commissioner shall serve notice
74-2 of the time and place of the hearing.
74-3 (b) The hearing is subject to the procedures for contested
74-4 cases under Chapter 2001, Government Code. The hearing must be
74-5 held not later than the 10th day after the date the commissioner
74-6 receives the request for a hearing unless the parties mutually
74-7 agree to a later hearing date.
74-8 (c) At the hearing, the person requesting the hearing is
74-9 entitled to show cause why the order should not be affirmed.
74-10 (d) Following receipt of the proposal for decision from the
74-11 State Office of Administrative Hearings regarding the hearing, the
74-12 commissioner shall affirm, modify, or set aside in whole or in part
74-13 the order. (V.T.I.C. Art. 1.10A, Secs. 3(c), (e), (f).)
74-14 Sec. 83.055. EFFECT OF ORDER PENDING HEARING. Pending a
74-15 hearing under this subchapter, an order continues in effect unless
74-16 the order is stayed by the commissioner. (V.T.I.C. Art. 1.10A,
74-17 Sec. 3(d).)
74-18 (Sections 83.056 to 83.100 reserved for expansion
74-19 SUBCHAPTER C. ENFORCEMENT
74-20 Sec. 83.101. AUTHORITY OF COMMISSIONER. If the commissioner
74-21 reasonably believes that a person has violated an order issued
74-22 under this chapter, the commissioner may:
74-23 (1) initiate proceedings under this subchapter to
74-24 impose an administrative penalty or direct restitution;
74-25 (2) refer the matter to the attorney general for
74-26 enforcement;
75-1 (3) initiate a proceeding to revoke the person's
75-2 certificate of authority; or
75-3 (4) pursue another action the commissioner considers
75-4 appropriate under applicable law. (V.T.I.C. Art. 1.10A, Sec.
75-5 4(a).)
75-6 Sec. 83.102. DETERMINATION OF VIOLATION. In determining
75-7 whether an order has been violated, the commissioner shall consider
75-8 the maintenance of procedures reasonably adopted to ensure
75-9 compliance with the order. (V.T.I.C. Art. 1.10A, Sec. 4(c)
75-10 (part).)
75-11 Sec. 83.103. HEARING ON ADMINISTRATIVE PENALTY. (a) If the
75-12 commissioner pursues action to impose an administrative penalty
75-13 under Section 83.101(1), the commissioner shall serve on the person
75-14 notice of the time and place of a hearing to be held not earlier
75-15 than the 21st day after the date the notice is received.
75-16 (b) The notice must contain a statement of the facts or
75-17 conduct alleged to violate the order.
75-18 (c) The commissioner shall serve the notice by registered or
75-19 certified mail, return receipt requested, to the person's last
75-20 known address.
75-21 (d) The hearing is subject to the procedures for contested
75-22 cases under Chapter 2001, Government Code. (V.T.I.C. Art. 1.10A,
75-23 Secs. 4(b), (c) (part).)
75-24 Sec. 83.104. IMPOSITION OF ADMINISTRATIVE PENALTY;
75-25 RESTITUTION. (a) After a hearing, if the commissioner determines
75-26 that an order has been violated, the commissioner may:
76-1 (1) impose an administrative penalty of $25,000 for
76-2 each act of violation;
76-3 (2) direct the person against whom the order was
76-4 issued to make complete restitution to each Texas resident, Texas
76-5 insured, and entity operating in this state that is harmed by the
76-6 violation; or
76-7 (3) impose the penalty and direct restitution.
76-8 (b) A person directed to make restitution shall make the
76-9 restitution in the form and amount and within the period determined
76-10 by the commissioner. (V.T.I.C. Art. 1.10A, Sec. 4(d).)
76-11 Sec. 83.105. FAILURE TO PAY PENALTY. If a person fails to
76-12 pay a penalty assessed under this subchapter, the commissioner may:
76-13 (1) refer the matter to the attorney general for
76-14 enforcement; or
76-15 (2) cancel or revoke any permit, license, certificate
76-16 of authority, certificate of registration, or other authorization
76-17 issued under this code as provided by Chapter 82. (V.T.I.C.
76-18 Art. 1.10A, Sec. 5.)
76-19 (Sections 83.106 to 83.150 reserved for expansion
76-20 SUBCHAPTER D. JUDICIAL REVIEW; JUDICIAL ACTION
76-21 Sec. 83.151. APPEAL. A person affected by an order of the
76-22 commissioner under Section 83.051 or 83.104 may appeal the order by
76-23 filing suit in a district court in Travis County not later than the
76-24 20th day after the date of the order. (V.T.I.C. Art. 1.10A, Secs.
76-25 3(h) (part), 4(f) (part).)
76-26 Sec. 83.152. EFFECT OF PETITION ON ORDER OR RELATED
77-1 DECISION. A petition for appeal filed under Section 83.151 does
77-2 not stay or vacate an order or a decision made under Subchapter B
77-3 unless the court, after hearing, issues an order that specifically
77-4 stays or vacates the order or decision. (V.T.I.C. Art. 1.10A, Sec.
77-5 3(h) (part).)
77-6 Sec. 83.153. JUDICIAL ACTION FOR ENFORCEMENT OF ORDER;
77-7 ATTORNEY'S FEES. The department may recover reasonable attorney's
77-8 fees if judicial action is necessary to enforce an order issued
77-9 under Section 83.051 or 83.104. (V.T.I.C. Art. 1.10A, Secs. 3(i),
77-10 4(f) (part).)
77-11 CHAPTER 84. ADMINISTRATIVE PENALTIES
77-12 SUBCHAPTER A. GENERAL PROVISIONS
77-13 Sec. 84.001. DEFINITION
77-14 Sec. 84.002. APPLICATION OF CHAPTER TO ADMINISTRATIVE
77-15 PENALTY
77-16 Sec. 84.003. APPLICATION OF ADMINISTRATIVE PROCEDURE ACT
77-17 (Sections 84.004 to 84.020 reserved for expansion
77-18 SUBCHAPTER B. IMPOSITION OF ADMINISTRATIVE PENALTY
77-19 Sec. 84.021. IMPOSITION OF PENALTY
77-20 Sec. 84.022. PENALTY AMOUNT
77-21 (Sections 84.023 to 84.040 reserved for expansion
77-22 SUBCHAPTER C. PROCEDURAL REQUIREMENTS
77-23 Sec. 84.041. REPORT AND NOTICE OF VIOLATION AND PENALTY
77-24 Sec. 84.042. PENALTY TO BE PAID OR HEARING REQUESTED
77-25 Sec. 84.043. HEARING AND DECISION
77-26 Sec. 84.044. DECISION BY COMMISSIONER
78-1 Sec. 84.045. OPTIONS FOLLOWING DECISION: PAY OR APPEAL
78-2 Sec. 84.046. STAY OF ENFORCEMENT OF PENALTY
78-3 Sec. 84.047. COLLECTION OF PENALTY
78-4 Sec. 84.048. STANDARD OF JUDICIAL REVIEW
78-5 Sec. 84.049. DECISION BY COURT
78-6 Sec. 84.050. REMITTANCE OF PENALTY AND INTEREST
78-7 Sec. 84.051. RELEASE OF BOND
78-8 CHAPTER 84. ADMINISTRATIVE PENALTIES
78-9 SUBCHAPTER A. GENERAL PROVISIONS
78-10 Sec. 84.001. DEFINITION. In this chapter, "person" means an
78-11 individual, corporation, trust, partnership, association, or any
78-12 other legal entity. (V.T.I.C. Art. 1.10E, Sec. 1(1).)
78-13 Sec. 84.002. APPLICATION OF CHAPTER TO ADMINISTRATIVE
78-14 PENALTY. (a) This chapter applies to each monetary penalty the
78-15 department or commissioner imposes under this code or another
78-16 insurance law of this state.
78-17 (b) For purposes of this chapter, each of the monetary
78-18 penalties is an administrative penalty. (V.T.I.C. Art. 1.10E,
78-19 Secs. 1(2), 8.)
78-20 Sec. 84.003. APPLICATION OF ADMINISTRATIVE PROCEDURE ACT. A
78-21 proceeding under this chapter is subject to Chapter 2001,
78-22 Government Code. (V.T.I.C. Art. 1.10E, Sec. 7.)
78-23 (Sections 84.004 to 84.020 reserved for expansion
78-24 SUBCHAPTER B. IMPOSITION OF ADMINISTRATIVE PENALTY
78-25 Sec. 84.021. IMPOSITION OF PENALTY. The commissioner may
78-26 impose an administrative penalty on a person licensed or regulated
79-1 under this code or another insurance law of this state who
79-2 violates:
79-3 (1) this code;
79-4 (2) another insurance law of this state; or
79-5 (3) a rule or order adopted under this code or another
79-6 insurance law of this state. (V.T.I.C. Art. 1.10E, Sec. 2 (part).)
79-7 Sec. 84.022. PENALTY AMOUNT. (a) The penalty for a
79-8 violation may not exceed $25,000, unless a greater or lesser
79-9 penalty is specified by this code or another insurance law of this
79-10 state.
79-11 (b) The amount of the penalty shall be based on:
79-12 (1) the seriousness of the violation, including:
79-13 (A) the nature, circumstances, extent, and
79-14 gravity of the violation; and
79-15 (B) the hazard or potential hazard created to
79-16 the health, safety, or economic welfare of the public;
79-17 (2) the economic harm to the public interest or public
79-18 confidence caused by the violation;
79-19 (3) the history of previous violations;
79-20 (4) the amount necessary to deter a future violation;
79-21 (5) efforts to correct the violation;
79-22 (6) whether the violation was intentional; and
79-23 (7) any other matter that justice may require.
79-24 (V.T.I.C. Art. 1.10E, Sec. 3.)
79-25 (Sections 84.023 to 84.040 reserved for expansion
80-1 SUBCHAPTER C. PROCEDURAL REQUIREMENTS
80-2 Sec. 84.041. REPORT AND NOTICE OF VIOLATION AND PENALTY.
80-3 (a) If the department determines that a violation has occurred,
80-4 the department may issue to the commissioner a report that states
80-5 the facts on which the determination is based and the department's
80-6 recommendation on the imposition of an administrative penalty,
80-7 including a recommendation on the amount of the penalty.
80-8 (b) Not later than the 14th day after the date the report is
80-9 issued, the department shall give written notice of the report to
80-10 the affected person. The notice may be given by certified mail.
80-11 The notice must:
80-12 (1) include:
80-13 (A) a brief summary of the alleged violation;
80-14 and
80-15 (B) a statement of the amount of the recommended
80-16 penalty; and
80-17 (2) inform the person that the person has a right to a
80-18 hearing on the occurrence of the violation, the amount of the
80-19 penalty, or both the occurrence of the violation and the amount of
80-20 the penalty. (V.T.I.C. Art. 1.10E, Secs. 2 (part), 4(a), (b).)
80-21 Sec. 84.042. PENALTY TO BE PAID OR HEARING REQUESTED.
80-22 (a) Not later than the 20th day after the date the person receives
80-23 the notice, the person, in writing, may:
80-24 (1) accept the department's determination and
80-25 recommended administrative penalty; or
80-26 (2) request a hearing on the occurrence of the
81-1 violation, the amount of the penalty, or both the occurrence of the
81-2 violation and the amount of the penalty.
81-3 (b) If the person accepts the department's determination and
81-4 recommended penalty, the commissioner by order shall approve the
81-5 determination and require the person to pay the recommended
81-6 penalty. (V.T.I.C. Art. 1.10E, Secs. 4(c), (d).)
81-7 Sec. 84.043. HEARING AND DECISION. (a) If the person
81-8 requests a hearing or fails to respond in a timely manner to the
81-9 notice, the department shall set a hearing and give notice of the
81-10 hearing to the person.
81-11 (b) An administrative law judge of the State Office of
81-12 Administrative Hearings shall conduct the hearing.
81-13 (c) The administrative law judge shall make findings of fact
81-14 and conclusions of law and promptly issue to the commissioner a
81-15 proposal for a decision about the occurrence of the violation and
81-16 the amount of a proposed administrative penalty. (V.T.I.C.
81-17 Art. 1.10E, Sec. 4(e) (part).)
81-18 Sec. 84.044. DECISION BY COMMISSIONER. (a) Based on the
81-19 findings of fact, conclusions of law, and proposal for decision,
81-20 the commissioner by order may:
81-21 (1) find that a violation occurred and impose an
81-22 administrative penalty; or
81-23 (2) find that a violation did not occur.
81-24 (b) The notice of the commissioner's order must include a
81-25 statement of the right of the person to judicial review of the
81-26 order. (V.T.I.C. Art. 1.10E, Secs. 4(e) (part), (f).)
82-1 Sec. 84.045. OPTIONS FOLLOWING DECISION: PAY OR APPEAL.
82-2 Not later than the 30th day after the date the commissioner's order
82-3 becomes final, the person shall:
82-4 (1) pay the administrative penalty; or
82-5 (2) file a petition for judicial review contesting the
82-6 occurrence of the violation or the amount of the penalty, or both,
82-7 and either pay or not pay the penalty. (V.T.I.C. Art. 1.10E, Sec.
82-8 4(g).)
82-9 Sec. 84.046. STAY OF ENFORCEMENT OF PENALTY. (a) A person
82-10 who files a petition for judicial review without paying the
82-11 administrative penalty may, within the 30-day period prescribed by
82-12 Section 84.045:
82-13 (1) stay enforcement of the penalty by:
82-14 (A) paying the penalty to the court for
82-15 placement in an escrow account; or
82-16 (B) giving the court a supersedeas bond approved
82-17 by the court that:
82-18 (i) is for the amount of the penalty; and
82-19 (ii) is effective until all judicial
82-20 review of the board's order is final; or
82-21 (2) request the court to stay enforcement of the
82-22 penalty by:
82-23 (A) filing with the court an affidavit stating
82-24 that the person is financially unable to pay the penalty and is
82-25 financially unable to give the supersedeas bond; and
82-26 (B) giving a copy of the affidavit to the
83-1 commissioner by certified mail.
83-2 (b) If the commissioner receives a copy of an affidavit
83-3 under Subsection (a)(2), the commissioner may file with the court,
83-4 not later than the fifth day after the date the copy is received, a
83-5 contest to the affidavit. The court shall hold a hearing on the
83-6 facts alleged in the affidavit as soon as practicable and shall
83-7 stay the enforcement of the penalty on finding that the alleged
83-8 facts are true. The person who files an affidavit has the burden
83-9 of proving that the person is financially unable to pay the penalty
83-10 and to give a supersedeas bond. (V.T.I.C. Art. 1.10E, Secs. 4(h),
83-11 (i).)
83-12 Sec. 84.047. COLLECTION OF PENALTY. If the person does not
83-13 pay the administrative penalty and the enforcement of the penalty
83-14 is not stayed, the commissioner may refer the matter to the
83-15 attorney general for collection of the penalty. (V.T.I.C.
83-16 Art. 1.10E, Sec. 4(j).)
83-17 Sec. 84.048. STANDARD OF JUDICIAL REVIEW. The order of the
83-18 commissioner is subject to judicial review under the substantial
83-19 evidence rule. (V.T.I.C. Art. 1.10E, Sec. 5(a).)
83-20 Sec. 84.049. DECISION BY COURT. (a) If the court sustains
83-21 the finding that a violation occurred, the court may uphold or
83-22 reduce the amount of the administrative penalty and order the
83-23 person to pay the full or reduced amount of the penalty.
83-24 (b) If the court does not sustain the finding that a
83-25 violation occurred, the court shall order that a penalty is not
83-26 owed. (V.T.I.C. Art. 1.10E, Sec. 5(b).)
84-1 Sec. 84.050. REMITTANCE OF PENALTY AND INTEREST. (a) If
84-2 the person paid the administrative penalty and if the amount of the
84-3 penalty is reduced or the penalty is not upheld by the court, the
84-4 court shall order, when the judgment becomes final, that the
84-5 appropriate amount plus accrued interest be remitted to the person.
84-6 (b) The interest accrues at the rate charged on loans to
84-7 depository institutions by the New York Federal Reserve Bank.
84-8 (c) The interest shall be paid for the period beginning on
84-9 the date the penalty is paid and ending on the date the penalty is
84-10 remitted. (V.T.I.C. Art. 1.10E, Sec. 5(c) (part).)
84-11 Sec. 84.051. RELEASE OF BOND. (a) If the person gave a
84-12 supersedeas bond and if the administrative penalty is not upheld by
84-13 the court, the court shall order, when the judgment becomes final,
84-14 the release of the bond.
84-15 (b) If the person gave a supersedeas bond and if the amount
84-16 of the penalty is reduced, the court shall order the release of the
84-17 bond after the person pays the reduced amount. (V.T.I.C.
84-18 Art. 1.10E, Sec. 5(c) (part).)
84-19 CHAPTER 85. GENERAL CRIMINAL ENFORCEMENT
84-20 SUBCHAPTER A. GENERAL PROVISIONS
84-21 Sec. 85.001. VIOLATION OF CERTAIN LAWS FOR WHICH PUNISHMENT
84-22 IS NOT PROVIDED; OFFENSE
84-23 (Sections 85.002 to 85.050 reserved for expansion
84-24 SUBCHAPTER B. PROSECUTION OF OFFENSES
84-25 Sec. 85.051. VENUE FOR PROSECUTION
84-26 Sec. 85.052. ELECTION OF PROSECUTION
85-1 CHAPTER 85. GENERAL CRIMINAL ENFORCEMENT
85-2 SUBCHAPTER A. GENERAL PROVISIONS
85-3 Sec. 85.001. VIOLATION OF CERTAIN LAWS FOR WHICH PUNISHMENT
85-4 IS NOT PROVIDED; OFFENSE. (a) A person commits an offense if the
85-5 person violates a law of this state regulating the business of
85-6 life, fire, or marine insurance.
85-7 (b) Unless another penalty is provided by law, an offense
85-8 under this section is a misdemeanor punishable by a fine of not
85-9 less than $500 or more than $1,000. (V.T.I.C. Art. 21.51.)
85-10 (Sections 85.002 to 85.050 reserved for expansion
85-11 SUBCHAPTER B. PROSECUTION OF OFFENSES
85-12 Sec. 85.051. VENUE FOR PROSECUTION. (a) A person who
85-13 violates the Penal Code or a penal provision of this code in
85-14 performing any act subject to regulation by the department may be
85-15 prosecuted in:
85-16 (1) Travis County; or
85-17 (2) a county in which prosecution is authorized under
85-18 the Code of Criminal Procedure.
85-19 (b) A law limiting regulation by the department under this
85-20 code or another insurance law of this state does not restrict the
85-21 application of this section.
85-22 (c) This section controls if there is a conflict or
85-23 ambiguity between this section and another provision of this code
85-24 or another insurance law of this state. (V.T.I.C. Art. 21.79B.)
85-25 Sec. 85.052. ELECTION OF PROSECUTION. A person who commits
85-26 an offense under this code may be prosecuted under this code or any
86-1 other law of this state under which the person may be prosecuted.
86-2 (V.T.I.C. Art. 21.79C.)
86-3 (Chapters 86 to 100 reserved for expansion
86-4 CHAPTER 101. UNAUTHORIZED INSURANCE
86-5 SUBCHAPTER A. GENERAL PROVISIONS
86-6 Sec. 101.001. STATE POLICY AND PURPOSE
86-7 Sec. 101.002. DEFINITIONS
86-8 Sec. 101.003. INSURANCE EXCHANGES AND SYNDICATES; RULES
86-9 Sec. 101.004. UNCONSTITUTIONAL APPLICATION PROHIBITED;
86-10 NOTICE TO COMMISSIONER
86-11 (Sections 101.005 to 101.050 reserved for expansion
86-12 SUBCHAPTER B. BUSINESS OF INSURANCE; EXCEPTIONS
86-13 Sec. 101.051. CONDUCT THAT CONSTITUTES THE BUSINESS OF
86-14 INSURANCE
86-15 Sec. 101.052. ADVERTISING RELATING TO MEDICARE
86-16 SUPPLEMENT POLICIES
86-17 Sec. 101.053. APPLICATION OF SUBCHAPTER
86-18 Sec. 101.054. EXCEPTION; FULL-TIME SALARIED EMPLOYEE
86-19 Sec. 101.055. EXCEPTION; CERTAIN ENTITIES THAT REIMBURSE
86-20 MEDICAL EXPENSES
86-21 (Sections 101.056 to 101.100 reserved for expansion
86-22 SUBCHAPTER C. PROHIBITION; ENFORCEMENT
86-23 Sec. 101.101. DEFINITION
86-24 Sec. 101.102. UNAUTHORIZED INSURANCE PROHIBITED
86-25 Sec. 101.103. POWERS OF COMMISSIONER; REMEDIES FOR
86-26 CERTAIN CONDUCT
87-1 Sec. 101.104. REQUEST FOR INFORMATION
87-2 Sec. 101.105. CIVIL PENALTY; INJUNCTIVE RELIEF
87-3 Sec. 101.106. CRIMINAL PENALTY
87-4 (Sections 101.107 to 101.150 reserved for expansion
87-5 SUBCHAPTER D. CEASE AND DESIST ORDERS
87-6 Sec. 101.151. POWERS OF COMMISSIONER; NOTICE OF HEARING
87-7 Sec. 101.152. HEARING
87-8 Sec. 101.153. CEASE AND DESIST ORDER
87-9 Sec. 101.154. ENFORCEMENT; REFERRAL TO ATTORNEY GENERAL
87-10 Sec. 101.155. EFFECT OF PRIOR PROCEEDINGS
87-11 Sec. 101.156. RULES
87-12 (Sections 101.157 to 101.200 reserved for expansion
87-13 SUBCHAPTER E. INSURANCE CONTRACTS WITH UNAUTHORIZED INSURERS
87-14 Sec. 101.201. VALIDITY OF INSURANCE CONTRACTS
87-15 Sec. 101.202. ATTORNEY'S FEES
87-16 Sec. 101.203. INVESTIGATION AND DISCLOSURE
87-17 (Sections 101.204 to 101.250 reserved for expansion
87-18 SUBCHAPTER F. TAXES
87-19 Sec. 101.251. PREMIUM RECEIPTS TAX
87-20 Sec. 101.252. INDEPENDENTLY PROCURED INSURANCE TAX
87-21 Sec. 101.253. FILING REQUIREMENTS FOR CORPORATIONS
87-22 (Sections 101.254 to 101.300 reserved for expansion
87-23 SUBCHAPTER G. REPORTING OF UNAUTHORIZED INSURANCE
87-24 Sec. 101.301. REPORTING REQUIRED
88-1 CHAPTER 101. UNAUTHORIZED INSURANCE
88-2 SUBCHAPTER A. GENERAL PROVISIONS
88-3 Sec. 101.001. STATE POLICY AND PURPOSE. (a) It is a state
88-4 concern that many residents of this state hold insurance policies
88-5 issued by persons or insurers who are not authorized to do
88-6 insurance business in this state and who are not qualified as
88-7 eligible surplus lines insurers under Article 1.14-2. These
88-8 residents face often insurmountable obstacles in asserting legal
88-9 rights under the policies in foreign forums under unfamiliar laws
88-10 and rules of practice.
88-11 (b) It is the policy of this state to protect residents
88-12 against acts by a person or insurer who is not authorized to do
88-13 insurance business in this state by:
88-14 (1) maintaining fair and honest insurance markets;
88-15 (2) protecting the premium tax revenues of this state;
88-16 (3) protecting authorized persons and insurers, who
88-17 are subject to strict regulation, from unfair competition by
88-18 unauthorized persons and insurers; and
88-19 (4) protecting against evasion of the insurance
88-20 regulatory laws of this state.
88-21 (c) The purpose of this chapter is to subject certain
88-22 insurers and other persons to the jurisdiction of:
88-23 (1) the commissioner and proceedings before the
88-24 commissioner; and
88-25 (2) the courts of this state in suits by or on behalf
88-26 of the state or an insured or beneficiary under an insurance
89-1 contract. (V.T.I.C. Art. 1.14-1, Sec. 1 (part).)
89-2 Sec. 101.002. DEFINITIONS. In this chapter:
89-3 (1) "Insurer" includes:
89-4 (A) a corporation, association, partnership, or
89-5 individual engaged as a principal in the business of insurance;
89-6 (B) an interinsurance exchange or mutual benefit
89-7 society; or
89-8 (C) an insurance exchange or syndicate.
89-9 (2) "Unfair act" means an unfair method of competition
89-10 or an unfair or deceptive act or practice as defined under Article
89-11 21.21 or a rule adopted under that article. (V.T.I.C. Art. 1.14-1,
89-12 Secs. 2(a) (part), 3(e) (part), 3A(a) (part).)
89-13 Sec. 101.003. INSURANCE EXCHANGES AND SYNDICATES; RULES.
89-14 The commissioner shall adopt rules defining insurance exchanges and
89-15 syndicates that are insurers for purposes of Section 101.002.
89-16 (V.T.I.C. Art. 1.14-1, Secs. 2(a) (part), (c).)
89-17 Sec. 101.004. UNCONSTITUTIONAL APPLICATION PROHIBITED;
89-18 NOTICE TO COMMISSIONER. (a) Subject to Subsection (b), this
89-19 chapter does not apply to an insurer or other person to whom, under
89-20 the constitution or statutes of the United States or the
89-21 constitution of this state, it may not apply.
89-22 (b) Before commencing operations, an insurer or other person
89-23 claiming an exemption described by Subsection (a) must file with
89-24 the commissioner:
89-25 (1) notice of the claim; and
89-26 (2) documents supporting the claim. (V.T.I.C.
90-1 Art. 1.14-1, Sec. 14.)
90-2 (Sections 101.005 to 101.050 reserved for expansion
90-3 SUBCHAPTER B. BUSINESS OF INSURANCE; EXCEPTIONS
90-4 Sec. 101.051. CONDUCT THAT CONSTITUTES THE BUSINESS OF
90-5 INSURANCE. (a) In this section, "medical expense" includes
90-6 surgical, chiropractic, physical therapy, speech pathology,
90-7 audiology, professional mental health, dental, hospital, or
90-8 optometric expenses.
90-9 (b) The following acts in this state constitute the business
90-10 of insurance in this state:
90-11 (1) making or proposing to make, as an insurer, an
90-12 insurance contract;
90-13 (2) making or proposing to make, as guarantor or
90-14 surety, a guaranty or suretyship contract as a vocation and not
90-15 merely incidental to another legitimate business or activity of
90-16 the guarantor or surety;
90-17 (3) taking or receiving an insurance application;
90-18 (4) receiving or collecting any consideration for
90-19 insurance, including:
90-20 (A) a premium;
90-21 (B) a commission;
90-22 (C) a membership fee;
90-23 (D) an assessment; or
90-24 (E) dues;
90-25 (5) issuing or delivering an insurance contract to:
90-26 (A) a resident of this state; or
91-1 (B) a person authorized to do business in this
91-2 state;
91-3 (6) directly or indirectly acting as an agent for or
91-4 otherwise representing or assisting an insurer or other person in:
91-5 (A) soliciting, negotiating, procuring, or
91-6 effectuating insurance or a renewal of insurance;
91-7 (B) disseminating information relating to
91-8 coverage or rates;
91-9 (C) forwarding an insurance application;
91-10 (D) delivering an insurance policy or contract;
91-11 (E) inspecting a risk;
91-12 (F) setting a rate;
91-13 (G) investigating or adjusting a claim or loss;
91-14 (H) transacting a matter after the effectuation
91-15 of the contract that arises out of the contract; or
91-16 (I) representing or assisting an insurer or
91-17 other person in any other manner in the transaction of insurance
91-18 with respect to a subject of insurance that is resident, located,
91-19 or to be performed in this state;
91-20 (7) contracting to provide in this state
91-21 indemnification or expense reimbursement for a medical expense by
91-22 direct payment, reimbursement, or otherwise to a person domiciled
91-23 in this state or for a risk located in this state, whether as an
91-24 insurer, agent, administrator, trust, or funding mechanism or by
91-25 another method;
91-26 (8) doing any kind of insurance business specifically
92-1 recognized as constituting insurance business within the meaning of
92-2 statutes relating to insurance;
92-3 (9) doing or proposing to do any insurance business
92-4 that is in substance equivalent to conduct described by
92-5 Subdivisions (1)-(8) in a manner designed to evade statutes
92-6 relating to insurance; or
92-7 (10) any other transaction of business in this state
92-8 by an insurer. (V.T.I.C. Art. 1.14-1, Sec. 2(a) (part).)
92-9 Sec. 101.052. ADVERTISING RELATING TO MEDICARE SUPPLEMENT
92-10 POLICIES. With respect to a medicare supplement policy authorized
92-11 under Article 3.74, the business of insurance in this state
92-12 includes using, creating, publishing, mailing, or disseminating in
92-13 this state an advertisement relating to an act that constitutes the
92-14 business of insurance under Section 101.051 unless the
92-15 advertisement is used, created, published, mailed, or disseminated
92-16 on behalf of an insurer or other person who:
92-17 (1) is authorized under this code to engage in the
92-18 business of insurance in this state;
92-19 (2) has actual knowledge of the content of the
92-20 advertisement;
92-21 (3) has authorized the advertisement to be used,
92-22 created, published, mailed, or disseminated on that insurer's or
92-23 other person's behalf; and
92-24 (4) is clearly identified by name in the advertisement
92-25 as the sponsor of the advertisement. (V.T.I.C. Art. 1.14-1, Sec.
92-26 2(a) (part).)
93-1 Sec. 101.053. APPLICATION OF SUBCHAPTER. (a) Sections
93-2 101.051 and 101.052 apply to an act whether performed by mail or
93-3 otherwise. Venue for an act performed by mail is at the place
93-4 where the matter transmitted by mail is delivered and takes effect.
93-5 (b) Sections 101.051 and 101.052 do not apply to:
93-6 (1) the lawful transaction of surplus lines insurance
93-7 under Article 1.14-2;
93-8 (2) the lawful transaction of reinsurance by insurers;
93-9 (3) a transaction in this state that:
93-10 (A) involves a policy that:
93-11 (i) is lawfully solicited, written, and
93-12 delivered outside this state; and
93-13 (ii) covers, at the time the policy is
93-14 issued, only subjects of insurance that are not resident, located,
93-15 or expressly to be performed in this state; and
93-16 (B) takes place after the policy is issued;
93-17 (4) a transaction:
93-18 (A) that involves an insurance contract
93-19 independently procured through negotiations occurring entirely
93-20 outside this state;
93-21 (B) that is reported; and
93-22 (C) on which premium tax is paid in accordance
93-23 with this chapter;
93-24 (5) a transaction in this state that:
93-25 (A) involves group life, health, or accident
93-26 insurance, other than credit insurance, and group annuities in
94-1 which the master policy for the group was lawfully issued and
94-2 delivered in a state in which the insurer or other person was
94-3 authorized to do insurance business; and
94-4 (B) is authorized by a statute of this state;
94-5 (6) a management or accounting activity in this state
94-6 on behalf of a nonadmitted captive insurance company that insures
94-7 solely directors' and officers' liability insurance for:
94-8 (A) the directors and officers of the company's
94-9 parent and affiliated companies;
94-10 (B) the risks of the company's parent and
94-11 affiliated companies; or
94-12 (C) both the individuals and entities described
94-13 by Paragraphs (A) and (B);
94-14 (7) the issuance of a qualified charitable gift
94-15 annuity under Chapter 102; or
94-16 (8) a lawful transaction by a servicing company of the
94-17 Texas workers' compensation employers' rejected risk fund under
94-18 Section 4.08, Article 5.76-2, as that article existed before its
94-19 repeal.
94-20 (c) Subsection (b)(6) does not exempt an insured or insurer
94-21 from the payment of an applicable tax on premium or from another
94-22 applicable provision of this code. (V.T.I.C. Art. 1.14-1, Secs.
94-23 2(a) (part), (b).)
94-24 Sec. 101.054. EXCEPTION; FULL-TIME SALARIED EMPLOYEE.
94-25 Section 101.051(b)(6) does not prohibit a full-time salaried
94-26 employee of a corporate insured from acting as an insurance manager
95-1 or buyer in placing insurance on behalf of:
95-2 (1) the employee's employer; or
95-3 (2) a parent or affiliated company of the employer.
95-4 (V.T.I.C. Art. 1.14-1, Sec. 2(a) (part).)
95-5 Sec. 101.055. EXCEPTION; CERTAIN ENTITIES THAT REIMBURSE
95-6 MEDICAL EXPENSES. (a) Section 101.051(b)(7) does not apply to:
95-7 (1) a program otherwise authorized by law that is
95-8 established:
95-9 (A) by a political subdivision of this state;
95-10 (B) by a state agency; or
95-11 (C) under Chapter 791, Government Code; or
95-12 (2) a multiple employer welfare arrangement that is
95-13 fully insured as defined by 29 U.S.C. Section 1144(b)(6).
95-14 (b) Notwithstanding Subsection (a)(2), the commissioner may
95-15 apply a law regulating the business of insurance to a multiple
95-16 employer welfare arrangement described by that subdivision to the
95-17 extent that the law provides:
95-18 (1) standards requiring the maintenance of specified
95-19 levels of contributions that the plan, or a trust established under
95-20 the plan, must meet to be considered able to pay benefits in full
95-21 when due; and
95-22 (2) provisions to enforce the standards described by
95-23 Subdivision (1). (V.T.I.C. Art. 1.14-1, Sec. 2(a) (part).)
95-24 (Sections 101.056 to 101.100 reserved for expansion
95-25 SUBCHAPTER C. PROHIBITION; ENFORCEMENT
95-26 Sec. 101.101. DEFINITION. In this subchapter, "person"
96-1 means an individual or entity that is a person for purposes of
96-2 Section 2(a), Article 21.21. (V.T.I.C. Art. 1.14-1, Sec. 3(a).)
96-3 Sec. 101.102. UNAUTHORIZED INSURANCE PROHIBITED. (a) A
96-4 person, including an insurer, may not directly or indirectly do an
96-5 act that constitutes the business of insurance under Subchapter B
96-6 except as authorized by statute.
96-7 (b) With respect to insurance of a subject that is resident,
96-8 located, or to be performed in this state, this section does not
96-9 prohibit an act performed outside this state, including the
96-10 collection of premiums, by a person, including an insurer,
96-11 authorized to do business in this state if the transaction and
96-12 insurance contract otherwise comply with statute. (V.T.I.C.
96-13 Art. 1.14-1, Sec. 3(b).)
96-14 Sec. 101.103. POWERS OF COMMISSIONER; REMEDIES FOR CERTAIN
96-15 CONDUCT. (a) If the commissioner has reason to believe a person,
96-16 including an insurer, has violated or is threatening to violate
96-17 this chapter or a rule adopted under this chapter, or that a
96-18 person, including an insurer, violating this chapter has engaged in
96-19 or is threatening to engage in an unfair act, the commissioner may:
96-20 (1) issue a cease and desist order under Subchapter D;
96-21 (2) seek injunctive relief under Section 101.105;
96-22 (3) request the attorney general to recover a civil
96-23 penalty under Section 101.105; or
96-24 (4) take any combination of those actions.
96-25 (b) This section does not limit the department to the
96-26 remedies specified in this section. The department and this state
97-1 may choose at any time, without regard to prior proceedings under
97-2 this section, any available remedy or action to immediately stop or
97-3 enjoin a person from engaging in the business of insurance without
97-4 statutory authorization. (V.T.I.C. Art. 1.14-1, Secs. 3(e) (part),
97-5 (h).)
97-6 Sec. 101.104. REQUEST FOR INFORMATION. If the commissioner
97-7 has reason to believe that a person, including an insurer, is
97-8 performing an act described by Section 101.051 or 101.052, the
97-9 person shall immediately provide to the commissioner, on written
97-10 request of the commissioner, information relating to that act.
97-11 (V.T.I.C. Art. 1.14-1, Sec. 3(c).)
97-12 Sec. 101.105. CIVIL PENALTY; INJUNCTIVE RELIEF. (a) A
97-13 person or entity, including an insurer, that violates this chapter
97-14 is subject to a civil penalty of not more than $10,000 for each act
97-15 of violation and for each day of violation.
97-16 (b) The commissioner may request that the attorney general
97-17 institute a civil suit in a district court in Travis County for
97-18 injunctive relief to restrain a person or entity, including an
97-19 insurer, from continuing a violation or threat of violation
97-20 described by Section 101.103(a). On application for injunctive
97-21 relief and a finding that a person or entity, including an insurer,
97-22 is violating or threatening to violate this chapter, the district
97-23 court shall grant the injunctive relief and issue an injunction
97-24 without bond.
97-25 (c) On request by the commissioner, the attorney general
97-26 shall institute and conduct a civil suit in the name of the state
98-1 for injunctive relief, to recover a civil penalty, or for both
98-2 injunctive relief and a civil penalty, as authorized under this
98-3 subchapter. (V.T.I.C. Art. 1.14-1, Secs. 3(d), (e) (part), (f),
98-4 (g).)
98-5 Sec. 101.106. CRIMINAL PENALTY. (a) A person, including an
98-6 insurer, who violates Section 101.102 commits an offense.
98-7 (b) An offense under this section is a felony of the third
98-8 degree.
98-9 (c) It is a defense to prosecution under this section that
98-10 Section 101.051 or 101.052, as applicable, by its terms does not
98-11 apply to the person charged. (V.T.I.C. Art. 1.14-1, Sec. 13.)
98-12 (Sections 101.107 to 101.150 reserved for expansion
98-13 SUBCHAPTER D. CEASE AND DESIST ORDERS
98-14 Sec. 101.151. POWERS OF COMMISSIONER; NOTICE OF HEARING.
98-15 (a) The commissioner may set a hearing on whether to issue a cease
98-16 and desist order under Section 101.153 if the commissioner has
98-17 reason to believe that:
98-18 (1) an insurer or other person has violated or is
98-19 threatening to violate this chapter or a rule adopted under this
98-20 chapter; or
98-21 (2) an insurer or other person acting in violation of
98-22 this chapter has engaged in or is threatening to engage in an
98-23 unfair act.
98-24 (b) The commissioner shall serve on the insurer or other
98-25 person a statement of charges and a notice of hearing in the form
98-26 provided by Section 2001.052, Government Code, and applicable rules
99-1 of the commissioner. (V.T.I.C. Art. 1.14-1, Sec. 3A(a) (part).)
99-2 Sec. 101.152. HEARING. (a) Except as agreed by the parties
99-3 with prior written approval of the commissioner, a hearing under
99-4 this subchapter must be held not earlier than the fifth day or
99-5 later than the 30th day after the date of service of the statement
99-6 and notice required under Section 101.151.
99-7 (b) The hearing shall be conducted in the manner provided
99-8 for a contested case under Chapter 2001, Government Code, and the
99-9 commissioner's rules. (V.T.I.C. Art. 1.14-1, Secs. 3A(a) (part),
99-10 (b).)
99-11 Sec. 101.153. CEASE AND DESIST ORDER. After a hearing held
99-12 under this subchapter, the commissioner may issue against the
99-13 insurer or other person charged with a violation an order that
99-14 requires that the insurer or other person immediately cease and
99-15 desist from the violation. (V.T.I.C. Art. 1.14-1, Sec. 3A(c).)
99-16 Sec. 101.154. ENFORCEMENT; REFERRAL TO ATTORNEY GENERAL.
99-17 The commissioner may refer the matter to the attorney general for
99-18 enforcement if the commissioner has reason to believe that an
99-19 insurer or other person has:
99-20 (1) violated a cease and desist order issued under
99-21 this subchapter; or
99-22 (2) failed to pay an assessed penalty. (V.T.I.C.
99-23 Art. 1.14-1, Sec. 3A(f).)
99-24 Sec. 101.155. EFFECT OF PRIOR PROCEEDINGS. The commissioner
99-25 and department may proceed under this chapter or any other
99-26 applicable law without regard to prior proceedings. (V.T.I.C.
100-1 Art. 1.14-1, Sec. 3A(h).)
100-2 Sec. 101.156. RULES. The commissioner may adopt reasonable
100-3 rules necessary to implement this subchapter. (V.T.I.C.
100-4 Art. 1.14-1, Sec. 3A(g).)
100-5 (Sections 101.157 to 101.200 reserved for expansion
100-6 SUBCHAPTER E. INSURANCE CONTRACTS WITH UNAUTHORIZED INSURERS
100-7 Sec. 101.201. VALIDITY OF INSURANCE CONTRACTS. (a) An
100-8 insurance contract effective in this state and entered into by an
100-9 unauthorized insurer is unenforceable by the insurer. A person who
100-10 in any manner assisted directly or indirectly in the procurement of
100-11 the contract is liable to the insured for the full amount of a
100-12 claim or loss under the terms of the contract if the unauthorized
100-13 insurer fails to pay the claim or loss.
100-14 (b) This section does not apply to:
100-15 (1) insurance procured by a licensed surplus lines
100-16 agent from an eligible surplus lines insurer as defined by Article
100-17 1.14-2:
100-18 (A) that is reported; and
100-19 (B) on which premium tax is paid in accordance
100-20 with Article 1.14-2; or
100-21 (2) an independently procured contract of insurance,
100-22 as described in Section 101.053(b)(4):
100-23 (A) that is reported; and
100-24 (B) on which premium tax is paid in accordance
100-25 with this chapter. (V.T.I.C. Art. 1.14-1, Sec. 8.)
100-26 Sec. 101.202. ATTORNEY'S FEES. (a) In an action against an
101-1 unauthorized insurer or other unauthorized person on a contract of
101-2 insurance issued or delivered in this state to a resident of this
101-3 state or to a corporation authorized to do business in this state,
101-4 the court may award to the plaintiff a reasonable attorney's fee
101-5 if:
101-6 (1) the insurer or other person failed, for at least
101-7 30 days after a demand made before the commencement of the action,
101-8 to make payment under the contract's terms; and
101-9 (2) the failure to make the payment was vexatious and
101-10 without reasonable cause.
101-11 (b) An insurer's or other person's failure to defend an
101-12 action described by Subsection (a) is prima facie evidence that the
101-13 failure to make payment was vexatious and without reasonable cause.
101-14 (V.T.I.C. Art. 1.14-1, Sec. 7.)
101-15 Sec. 101.203. INVESTIGATION AND DISCLOSURE. (a) If the
101-16 commissioner has reason to believe that insurance has been
101-17 effectuated by or for a person in this state with an unauthorized
101-18 insurer, the commissioner shall in writing order the person to:
101-19 (1) produce for examination all insurance contracts
101-20 and other documents evidencing insurance with both authorized and
101-21 unauthorized insurers; and
101-22 (2) disclose to the commissioner:
101-23 (A) the amount of insurance;
101-24 (B) the name and address of each insurer;
101-25 (C) the gross amount of premiums paid or to be
101-26 paid; and
102-1 (D) the name and address of each person
102-2 assisting in the solicitation, negotiation, or effectuation of the
102-3 insurance.
102-4 (b) A person who fails to comply with a written order under
102-5 Subsection (a) before the 31st day after the date of the order or
102-6 who wilfully makes a disclosure that is untrue, deceptive, or
102-7 misleading shall forfeit:
102-8 (1) $50; and
102-9 (2) an additional $50 for each day the person
102-10 continues to fail to comply after expiration of the 30-day period.
102-11 (c) This section does not apply to:
102-12 (1) a transaction in this state that:
102-13 (A) involves a policy that:
102-14 (i) is lawfully solicited, negotiated,
102-15 written, and delivered outside this state; and
102-16 (ii) covers, at the time the policy is
102-17 issued, only subjects of insurance that are not resident, located,
102-18 or expressly to be performed in this state; and
102-19 (B) takes place after the policy is issued; or
102-20 (2) surplus lines insurance procured through eligible
102-21 surplus lines carriers as defined by Article 1.14-2. (V.T.I.C.
102-22 Art. 1.14-1, Sec. 9.)
102-23 (Sections 101.204 to 101.250 reserved for expansion
102-24 SUBCHAPTER F. TAXES
102-25 Sec. 101.251. PREMIUM RECEIPTS TAX. (a) In this section,
102-26 "premium" includes any consideration for insurance, including:
103-1 (1) a premium;
103-2 (2) a membership fee;
103-3 (3) an assessment; or
103-4 (4) dues.
103-5 (b) Except as provided by Subsection (j), an unauthorized
103-6 insurer shall pay to the comptroller, on a form prescribed by the
103-7 comptroller, a premium receipts tax of 4.85 percent of gross
103-8 premiums charged for insurance on a subject resident, located, or
103-9 to be performed in this state.
103-10 (c) If a policy covers risks or exposures only partially in
103-11 this state, the tax payable is computed on the portion of the
103-12 premium that is properly allocated to a risk or exposure located in
103-13 this state.
103-14 (d) In determining the amount of taxable premiums under
103-15 Subsection (c), all premiums, other than premiums properly
103-16 allocated or apportioned and reported as taxable premiums of
103-17 another state, that are written, procured, or received in this
103-18 state or that are for a policy negotiated in this state are
103-19 considered to be written on property or risks located or resident
103-20 in this state.
103-21 (e) Insurance on a subject resident, located, or to be
103-22 performed in this state is considered to be insurance procured,
103-23 continued, or renewed in this state regardless of the location from
103-24 which:
103-25 (1) the application is made;
103-26 (2) the negotiations are conducted; or
104-1 (3) the premiums are remitted.
104-2 (f) Premiums on risks or exposures that are properly
104-3 allocated to federal waters or international waters or under the
104-4 jurisdiction of a foreign government are not taxable by this state.
104-5 (g) The unauthorized insurer shall pay the premium receipts
104-6 tax required by this section before:
104-7 (1) March 1 following the calendar year in which the
104-8 insurance was effectuated, continued, or renewed; or
104-9 (2) another date specified by the comptroller.
104-10 (h) The tax imposed by this section is in lieu of all other
104-11 insurance taxes.
104-12 (i) On default of an unauthorized insurer in the payment of
104-13 the tax, the insured shall pay the tax.
104-14 (j) This section does not apply to premiums on:
104-15 (1) insurance procured by a licensed surplus lines
104-16 agent from an eligible surplus lines insurer as defined by Article
104-17 1.14-2 on which premium tax is paid in accordance with Article
104-18 1.14-2; or
104-19 (2) an independently procured contract of insurance on
104-20 which premium tax is paid in accordance with this chapter.
104-21 (V.T.I.C. Art. 1.14-1, Secs. 11(a) (part), (b).)
104-22 Sec. 101.252. INDEPENDENTLY PROCURED INSURANCE TAX.
104-23 (a) Except as provided by Subsection (f), an insured who procures
104-24 insurance in accordance with Section 101.053(b)(4), or another
104-25 person designated by the insured, shall:
104-26 (1) file a report with the comptroller; and
105-1 (2) pay an independently procured insurance tax of
105-2 4.85 percent.
105-3 (b) If a policy covers risks or exposures only partially
105-4 located in this state, the tax payable is computed on the portion
105-5 of the premium that is properly allocated to a risk or exposure
105-6 located in this state.
105-7 (c) An insured who fails to withhold from the premium the
105-8 amount of tax imposed under this section is liable for the amount
105-9 of the tax and shall pay the tax to the comptroller within the time
105-10 described by Subsection (d).
105-11 (d) Except as provided by Section 101.253, the report and
105-12 tax are due on or before:
105-13 (1) March 1 following the calendar year in which the
105-14 insurance was procured, continued, or renewed; or
105-15 (2) another date specified by the comptroller.
105-16 (e) This section does not abrogate or modify any other
105-17 provision of this chapter.
105-18 (f) This section does not apply to premiums for individual
105-19 life or individual disability insurance. (V.T.I.C. Art. 1.14-1,
105-20 Secs. 12(a), (b), (c), (d) (part), (e).)
105-21 Sec. 101.253. FILING REQUIREMENTS FOR CORPORATIONS. The
105-22 amount of tax due and payable under Section 101.252 with respect to
105-23 a corporation that files a franchise tax return shall be reported
105-24 directly to the comptroller and is due:
105-25 (1) at the time the franchise tax report is due; or
105-26 (2) on another date specified by the comptroller.
106-1 (V.T.I.C. Art. 1.14-1, Sec. 12A (part).)
106-2 (Sections 101.254 to 101.300 reserved for expansion
106-3 SUBCHAPTER G. REPORTING OF UNAUTHORIZED INSURANCE
106-4 Sec. 101.301. REPORTING REQUIRED. (a) A person
106-5 investigating or adjusting a loss or claim on a subject of
106-6 insurance in this state shall immediately report to the department
106-7 an insurance policy or contract that has been entered into by an
106-8 insurer that is not authorized to transact the insurance in this
106-9 state.
106-10 (b) This section does not apply to:
106-11 (1) a transaction described by Section 101.053(b)(4);
106-12 or
106-13 (2) surplus lines insurance procured through eligible
106-14 surplus lines carriers as defined by Article 1.14-2. (V.T.I.C.
106-15 Art. 1.14-1, Sec. 10.)
106-16 CHAPTER 102. CHARITABLE GIFT ANNUITIES
106-17 SUBCHAPTER A. GENERAL PROVISIONS
106-18 Sec. 102.001. DEFINITIONS
106-19 Sec. 102.002. QUALIFIED CHARITABLE GIFT ANNUITY
106-20 (Sections 102.003 to 102.050 reserved for expansion
106-21 SUBCHAPTER B. ISSUANCE OF CHARITABLE GIFT ANNUITY
106-22 Sec. 102.051. NOT INSURANCE; EFFECT OF CERTAIN LAWS
106-23 (Sections 102.052 to 102.100 reserved for expansion
106-24 SUBCHAPTER C. NOTICE
106-25 Sec. 102.101. NOTICE TO DONOR
106-26 Sec. 102.102. NOTICE TO DEPARTMENT
107-1 Sec. 102.103. EFFECT ON ANNUITY OF FAILURE TO PROVIDE
107-2 NOTICE
107-3 Sec. 102.104. ENFORCEMENT OF NOTICE REQUIREMENTS
107-4 CHAPTER 102. CHARITABLE GIFT ANNUITIES
107-5 SUBCHAPTER A. GENERAL PROVISIONS
107-6 Sec. 102.001. DEFINITIONS. In this chapter:
107-7 (1) "Charitable gift annuity" means an annuity:
107-8 (A) that is payable over the lives of one or two
107-9 individuals;
107-10 (B) that is made in return for the transfer of
107-11 cash or other property to a charitable organization; and
107-12 (C) the actuarial value of which is less than
107-13 the value of the cash or other property transferred, with the
107-14 difference in those values being a charitable deduction for federal
107-15 tax purposes.
107-16 (2) "Charitable organization" means an entity
107-17 described by:
107-18 (A) Section 501(c)(3), Internal Revenue Code of
107-19 1986; or
107-20 (B) Section 170(c), Internal Revenue Code of
107-21 1986. (V.T.I.C. Art. 1.14-1A, Secs. 1(1), (2).)
107-22 Sec. 102.002. QUALIFIED CHARITABLE GIFT ANNUITY. A
107-23 charitable gift annuity is a qualified charitable gift annuity for
107-24 purposes of this chapter if it was issued before September 1, 1995,
107-25 or if it is:
107-26 (1) described by Section 501(m)(5), Internal Revenue
108-1 Code of 1986; and
108-2 (2) issued by a charitable organization that on the
108-3 date of the annuity agreement:
108-4 (A) has, exclusive of the assets funding the
108-5 annuity agreement, a minimum of $100,000 in unrestricted cash, cash
108-6 equivalents, or publicly traded securities; and
108-7 (B) has been in continuous operation for at
108-8 least three years or is a successor or affiliate of a charitable
108-9 organization that has been in continuous operation for at least
108-10 three years. (V.T.I.C. Art. 1.14-1A, Secs. 1(3), 2(b) (part).)
108-11 (Sections 102.003 to 102.050 reserved for expansion
108-12 SUBCHAPTER B. ISSUANCE OF CHARITABLE GIFT ANNUITY
108-13 Sec. 102.051. NOT INSURANCE; EFFECT OF CERTAIN LAWS. The
108-14 issuance of a qualified charitable gift annuity:
108-15 (1) does not constitute engaging in the business of
108-16 insurance in this state;
108-17 (2) does not violate Section 15.05 or 17.46, Business
108-18 & Commerce Code; and
108-19 (3) is not an unconscionable action or course of
108-20 action for purposes of Section 17.50(a)(3), Business & Commerce
108-21 Code. (V.T.I.C. Art. 1.14-1A, Secs. 2(a), (b) (part); 6.)
108-22 (Sections 102.052 to 102.100 reserved for expansion
108-23 SUBCHAPTER C. NOTICE
108-24 Sec. 102.101. NOTICE TO DONOR. (a) A charitable
108-25 organization that issues a qualified charitable gift annuity shall
108-26 give to the donor, at the time an agreement for a qualified
109-1 charitable gift annuity is entered into, written notice that the
109-2 annuity is not:
109-3 (1) insurance under the laws of this state;
109-4 (2) subject to regulation by the department; and
109-5 (3) protected by a guaranty association affiliated
109-6 with the department.
109-7 (b) The notice must be in a separate paragraph of the
109-8 annuity agreement in a print size at least as large as the print
109-9 size generally used in the agreement. (V.T.I.C. Art. 1.14-1A, Sec.
109-10 3.)
109-11 Sec. 102.102. NOTICE TO DEPARTMENT. (a) A charitable
109-12 organization that issues qualified charitable gift annuities shall
109-13 notify the department's annuities division in writing not later
109-14 than the date on which the organization enters into the
109-15 organization's first qualified charitable gift annuity agreement.
109-16 (b) The notice required by this section must:
109-17 (1) be signed by an officer or director of the
109-18 organization;
109-19 (2) identify the organization; and
109-20 (3) certify that:
109-21 (A) the organization is a charitable
109-22 organization; and
109-23 (B) the annuities issued by the organization are
109-24 qualified charitable gift annuities.
109-25 (c) The charitable organization may not be required to
109-26 submit additional information except to determine appropriate
110-1 penalties under Section 102.104. (V.T.I.C. Art. 1.14-1A, Sec. 4.)
110-2 Sec. 102.103. EFFECT ON ANNUITY OF FAILURE TO PROVIDE
110-3 NOTICE. A charitable gift annuity that otherwise meets the
110-4 requirements of Section 102.002 is a qualified charitable gift
110-5 annuity without regard to whether the charitable organization that
110-6 issues the annuity complies with the notice requirements of this
110-7 subchapter. (V.T.I.C. Art. 1.14-1A, Sec. 5 (part).)
110-8 Sec. 102.104. ENFORCEMENT OF NOTICE REQUIREMENTS. (a) The
110-9 commissioner may enforce the notice requirements of this subchapter
110-10 by sending by certified mail, return receipt requested, a letter
110-11 demanding that the charitable organization comply with the notice
110-12 requirements.
110-13 (b) The department may fine the charitable organization in
110-14 an amount not to exceed $1,000 for each qualified charitable gift
110-15 annuity agreement issued by the organization until the time the
110-16 organization complies with this subchapter. (V.T.I.C.
110-17 Art. 1.14-1A, Sec. 5 (part).)
110-18 SECTION 2. CONFORMING AMENDMENT. Chapters 1-27, Insurance
110-19 Code, are designated as Title 1, Insurance Code, and a title
110-20 heading is added to read as follows:
110-21 TITLE 1. THE INSURANCE CODE OF 1951
110-22 SECTION 3. CONFORMING AMENDMENT. Subsection (a), Article
110-23 1.04D, Insurance Code, is amended to read as follows:
110-24 (a) Except as otherwise expressly provided for in this code
110-25 or another insurance law of this state, the comptroller shall
110-26 administer, enforce, and carry out the provisions of this code and
111-1 other insurance laws of this state that relate [duties of the
111-2 department and commissioner relative] to the collection, reporting,
111-3 and administration of taxes and certain fees and assessments
111-4 imposed under this code or another insurance law of this state [are
111-5 transferred to the comptroller effective September 1, 1993], as
111-6 specifically provided in this code.
111-7 SECTION 4. CONFORMING AMENDMENT. Article 1.10, Insurance
111-8 Code, is amended to read as follows:
111-9 Art. 1.10. CERTAIN DUTIES OF THE DEPARTMENT. In addition to
111-10 the other duties required of the Department, the Department shall
111-11 perform duties as follows:
111-12 [1. Shall Execute the Laws. See that all laws
111-13 respecting insurance and insurance companies are faithfully
111-14 executed.]
111-15 2. File Articles of Incorporation and Other Papers.
111-16 File and preserve in its office all acts or articles of
111-17 incorporation of insurance companies and all other papers required
111-18 by law to be deposited with the Department and, upon application of
111-19 any party interested therein, furnish certified copies thereof upon
111-20 payment of the fees prescribed by law.
111-21 3. Shall Calculate Reserve. For every company
111-22 transacting any kind of insurance business in this State, for which
111-23 no basis is prescribed by law, the Department shall calculate the
111-24 reinsurance reserve upon the same basis prescribed in Article 6.01
111-25 of this code as to companies transacting fire insurance business.
111-26 4. To Calculate Re-insurance Reserve. On the
112-1 thirty-first day of December of each and every year, or as soon
112-2 thereafter as may be practicable, the Department shall have
112-3 calculated in the Department the re-insurance reserve for all
112-4 unexpired risks of all insurance companies organized under the laws
112-5 of this state, or transacting business in this state, transacting
112-6 any kind of insurance other than life, fire, marine, inland,
112-7 lightning or tornado insurance, which calculation shall be in
112-8 accordance with the provisions of Paragraph 3 hereof.
112-9 5. When a Company's Surplus is Impaired. No
112-10 impairment of the capital stock of a stock company shall be
112-11 permitted. No impairment of the surplus of a stock company, or of
112-12 the minimum required aggregate surplus of a mutual, Lloyd's, or
112-13 reciprocal insurer, shall be permitted in excess of that provided
112-14 by this section. Having charged against a company other than a
112-15 life insurance company, the reinsurance reserve, as prescribed by
112-16 the laws of this State, and adding thereto all other debts and
112-17 claims against the company, the Commissioner shall, (i) if it is
112-18 determined that the surplus required by Article 2.02 or 2.20 of
112-19 this code of a stock company doing the kind or kinds of insurance
112-20 business set out in its Certificate of Authority is impaired to the
112-21 extent of more than fifty (50%) per cent of the required surplus
112-22 for a capital stock insurance company, or is less than the minimum
112-23 level of surplus required by Commissioner promulgated risk-based
112-24 capital and surplus regulations, or (ii) if it is determined that
112-25 the required aggregate surplus of a reciprocal or mutual company,
112-26 or the required aggregate of guaranty fund and surplus of a Lloyd's
113-1 company, other than a life insurance company, doing the kind or
113-2 kinds of insurance business set out in its Certificate of Authority
113-3 is impaired to the extent of more than twenty-five per cent (25%)
113-4 of the required aggregate surplus, or is less than the minimum
113-5 level of surplus required by Commissioner promulgated risk-based
113-6 capital and surplus regulations, the Commissioner shall order the
113-7 company to remedy the impairment of surplus to acceptable levels
113-8 specified by the Commissioner or to cease to do business within
113-9 this State. The Commissioner shall thereupon immediately institute
113-10 such proceedings as may be necessary to determine what further
113-11 actions shall be taken in the case.
113-12 6. Shall Publish Results of Investigation. The
113-13 Department shall publish the result of an examination of the
113-14 affairs of any company whenever the Commissioner deems it for the
113-15 interest of the public.
113-16 [7. May Order Sanctions. (a) After notice and
113-17 opportunity for a hearing, the Commissioner may cancel or revoke
113-18 any permit, license, certificate of authority, certificate of
113-19 registration, or other authorization issued or existing under the
113-20 Commissioner's authority or the authorization of this Code if the
113-21 holder or possessor of same is found to be in violation of, or to
113-22 have failed to comply with, a specific provision of the Code or any
113-23 duly promulgated rule or regulation of the Commissioner. The
113-24 Commissioner may also order one or more of the following sanctions:]
113-25 [(1) Suspend such authorization for a time
113-26 certain, not to exceed one year;]
114-1 [(2) Order the holder or possessor of such
114-2 authorization to cease and desist from the specified activity
114-3 determined to be in violation of specific provisions of this Code
114-4 or rules and regulations of the Commissioner or from failure to
114-5 comply with such provisions of this Code or such rules and
114-6 regulations;]
114-7 [(3) Direct the holder or possessor of such
114-8 authorization to pay an administrative penalty in accordance with
114-9 Article 1.10E of this code; or]
114-10 [(4) Direct the holder or possessor of such
114-11 authorization to make complete restitution to all Texas residents,
114-12 Texas insureds, and entities operating in Texas harmed by the
114-13 violation or failure to comply.]
114-14 [(b) Restitution under Subdivision (4) of Subsection
114-15 (a) must be made in the form and amount and within the period
114-16 determined by the Commissioner.]
114-17 [(c) If it is found after hearing that any holder or
114-18 possessor has failed to comply with an order issued pursuant to
114-19 Subsection (a), the Commissioner shall, unless its order is
114-20 lawfully stayed, cancel all authorizations of such holder or
114-21 possessor.]
114-22 [(d) The Commissioner may informally dispose of any
114-23 matter specified in this section by consent order, agreed
114-24 settlement, stipulations, or default. An informal disposition or
114-25 consent order may include a provision under which the holder or
114-26 possessor agrees to a sanction under this section with the express
115-1 reservation that:]
115-2 [(1) the holder or possessor is not admitting
115-3 any violation of this code or of a rule or regulation; and]
115-4 [(2) the existence of a violation is in dispute.]
115-5 [(e) The Commissioner shall give notice of any action
115-6 taken pursuant to this section to the Insurance Commissioner or
115-7 other similar officer of every state.]
115-8 [(f) The authority vested in the Commissioner in this
115-9 Article shall be in addition to and not in lieu of any other
115-10 authority to enforce or cause to be enforced any sanctions,
115-11 penalties, fines, forfeitures, denials, suspensions, or revocations
115-12 otherwise authorized by law, and shall be applicable to every form
115-13 of authorization to any person or entity holding or possessing the
115-14 same.]
115-15 [(g) This section applies to all companies regulated
115-16 by the Commissioner, including but not limited to domestic and
115-17 foreign, stock and mutual life, health, and accident insurance
115-18 companies; domestic and foreign, stock and mutual, fire and
115-19 casualty insurance companies; Mexican casualty companies; domestic
115-20 and foreign Lloyd's plan insurers; domestic and foreign reciprocal
115-21 or interinsurance exchanges; domestic and foreign fraternal benefit
115-22 societies; domestic and foreign title insurance companies;
115-23 attorney's title insurance companies; stipulated premium insurance
115-24 companies; nonprofit legal service corporations; health maintenance
115-25 organizations; statewide mutual assessment companies; local mutual
115-26 aid associations; local mutual burial associations; exempt
116-1 associations under Article 14.17 of this Code; nonprofit hospital,
116-2 medical, or dental service corporations including but not limited
116-3 to companies subject to Chapter 20 of this Code; county mutual
116-4 insurance companies; and farm mutual insurance companies. Also,
116-5 this section applies to all agents of those companies and generally
116-6 to all other individuals, corporations, associations, partnerships,
116-7 and other natural or artificial persons engaged in the business of
116-8 insurance or that hold a permit, certificate, registration,
116-9 license, or other authority under this Code or that are regulated
116-10 by the Commissioner.]
116-11 [8. Report to Attorney General. The Department shall
116-12 report promptly and in detail to the Attorney General any violation
116-13 of law relative to insurance companies or the business of
116-14 insurance.]
116-15 [9. Shall Furnish Blanks. The Department shall
116-16 furnish to the companies required to report to the Department the
116-17 necessary blank forms for the statements required.]
116-18 [10. Shall Keep Records. The Department shall
116-19 preserve in a permanent form a full record of the Department's
116-20 proceedings and a concise statement of the condition of each
116-21 company or agency visited or examined.]
116-22 [11. Give Certified Copies. At the request of any
116-23 person, and on the payment of the legal fee, the Department shall
116-24 give certified copies of any record or papers in its office, when
116-25 the Commissioner deems it not prejudicial to public interest and
116-26 shall give such other certificates as are provided for by law. The
117-1 fees collected by the Department under this section shall be
117-2 deposited in the State Treasury to the credit of the Texas
117-3 Department of Insurance operating fund.]
117-4 [12. Report to Governor and Legislature. The
117-5 Department shall file annually with the Governor and the presiding
117-6 officer of each house of the Legislature a complete and detailed
117-7 written report accounting for all funds received and disbursed by
117-8 the Department during the preceding fiscal year. The annual report
117-9 must be in the form and reported in the time provided by the
117-10 General Appropriations Act. The report shall also contain the
117-11 Commissioner's official acts, the condition of companies doing
117-12 business in this State, and such other information as will exhibit
117-13 the affairs of the Department.]
117-14 [13. Send Copies of Reports To. The Department shall
117-15 send a copy of the annual report to the Insurance Commissioner or
117-16 other similar officer of every state and, on request, shall send a
117-17 copy to each company doing business in Texas.]
117-18 [14. Report Laws to Other States. On request, the
117-19 Department shall communicate to the Insurance Commissioner or other
117-20 similar officer of any other state, in which the substantial
117-21 provisions of the law of this State relative to insurance have
117-22 been, or shall be, enacted, any facts which by law it is his duty
117-23 to ascertain respecting the companies of this State doing business
117-24 within such other state.]
117-25 15. See That No Company Does Business. The
117-26 Commissioner shall see that no company is permitted to transact the
118-1 business of life insurance in this State whose charter authorizes
118-2 it to do a fire, marine, lightning, tornado, or inland insurance
118-3 business, and that no company authorized to do a life insurance
118-4 business in this State be permitted to take fire, marine or inland
118-5 risks.
118-6 16. Admit Mutual Companies. The Commissioner shall
118-7 admit into this State mutual insurance companies engaged in
118-8 cyclone, tornado, hail and storm insurance which are organized
118-9 under the laws of other states and which have Two Million
118-10 ($2,000,000.00) Dollars assets in excess of liabilities.
118-11 17. Voluntary Deposits. (a) In the event any
118-12 insurance company organized and doing business under the provisions
118-13 of this Code shall be required by any other state, country or
118-14 province as a requirement for permission to do an insurance
118-15 business therein to make or maintain a deposit with an officer of
118-16 any state, country, or province, such company, at its discretion,
118-17 may voluntarily deposit with the Comptroller such securities as may
118-18 be approved by the Commissioner of Insurance to be of the type and
118-19 character authorized by law to be legal investments for such
118-20 company, or cash, in any amount sufficient to enable it to meet
118-21 such requirements. The Comptroller is hereby authorized and
118-22 directed to receive such deposit and hold it exclusively for the
118-23 protection of all policyholders or creditors of the company
118-24 wherever they may be located, or for the protection of the
118-25 policyholders or creditors of a particular state, country or
118-26 province, as may be designated by such company at the time of
119-1 making such deposit. The company may, at its option, withdraw such
119-2 deposit or any part thereof, first having deposited with the
119-3 Comptroller, in lieu thereof, other securities of like class and of
119-4 equal amount and value to those withdrawn, which withdrawal and
119-5 substitution must be approved by the Commissioner of Insurance.
119-6 The proper officer of each insurance company making such deposit
119-7 shall be permitted at all reasonable times to examine such
119-8 securities and to detach coupons therefrom, and to collect interest
119-9 thereon, under such reasonable rules and regulations as may be
119-10 prescribed by the Comptroller and the Commissioner of Insurance.
119-11 Any deposit so made for the protection of policyholders or
119-12 creditors of a particular state, country or province shall not be
119-13 withdrawn, except by substitution as provided above, by the
119-14 company, except upon filing with the Commissioner of Insurance
119-15 evidence satisfactory to him that the company has withdrawn from
119-16 business, and has no unsecured liabilities outstanding or potential
119-17 policyholder liabilities or obligations in such other state,
119-18 country or province requiring such deposit, and upon the filing of
119-19 such evidence the company may withdraw such deposit at any time
119-20 upon the approval of the Commissioner of Insurance. Any deposit so
119-21 made for the protection of all policyholders or creditors wherever
119-22 they may be located shall not be withdrawn, except by substitution
119-23 as provided above, by the company except upon filing with the
119-24 Commissioner of Insurance evidence satisfactory to him that the
119-25 company does not have any unsecured liabilities outstanding or
119-26 potential policy liabilities or obligations anywhere, and upon
120-1 filing such evidence the company may withdraw such deposit upon the
120-2 approval of the Commissioner of Insurance. For the purpose of
120-3 state, county and municipal taxation, the situs of any securities
120-4 deposited with the Comptroller hereunder shall be in the city and
120-5 county where the principal business office of such company is fixed
120-6 by its charter.
120-7 (b) Any voluntary deposit held by the Comptroller or
120-8 the Department heretofore made by any insurance company in this
120-9 State, and which deposit was made for the purpose of gaining
120-10 admission to another state, may be considered, at the option of
120-11 such company, to be hereinafter held under the provisions of this
120-12 Act.
120-13 (c) When two or more companies merge or consolidate or
120-14 enter a total reinsurance contract by which the ceding company is
120-15 dissolved and its assets acquired and liabilities assumed by the
120-16 surviving company, and the companies have on deposit with the
120-17 Comptroller two or more deposits made for identical purposes under
120-18 this section or Article 4739, Revised Statutes, as amended, and now
120-19 repealed, all such deposits, except the deposit of greatest amount
120-20 and value, may be withdrawn by the new surviving or reinsuring
120-21 company, upon proper showing of duplication of such deposits and
120-22 that the company is the owner thereof.
120-23 (d) Any company which has made a deposit or deposits
120-24 under this section or Article 4739, Revised Statutes, as amended
120-25 and now repealed, shall be entitled to a return of such deposits
120-26 upon proper application therefor and a showing before the
121-1 Commissioner that such deposit or deposits are no longer required
121-2 under the laws of any state, country or province in which such
121-3 company sought or gained admission to do business upon the strength
121-4 of a certificate of such deposit.
121-5 (e) Upon being furnished a certified copy of the
121-6 Commissioner's order issued under Subsection (c) or (d) above, the
121-7 Comptroller shall release, transfer and deliver such deposit or
121-8 deposits to the owner as directed in said order.
121-9 18. Complaint File. The Department shall keep an
121-10 information file about each complaint filed with the Department
121-11 concerning an activity that is regulated by the Department or
121-12 Commissioner.
121-13 19. Notice of Complaint Status. If a written
121-14 complaint is filed with the Department, the Department, at least
121-15 quarterly and until final disposition of the complaint, shall
121-16 notify the parties to the complaint of the status of the complaint
121-17 unless the notice would jeopardize an undercover investigation.
121-18 20. Electronic Transfer of Funds. The Commissioner
121-19 shall adopt rules for the electronic transfer of any taxes, fees,
121-20 guarantee funds, or other money owed to or held for the benefit of
121-21 the state and for which the Department has the responsibility to
121-22 administer under this code or another insurance law of this state.
121-23 The Commissioner shall require the electronic transfer of any
121-24 amounts held or owed in an amount exceeding $500,000.
121-25 SECTION 5. REPEALER. Articles 1.01A, 1.02, 1.03A, 1.03B,
121-26 1.04, 1.04C, 1.06, 1.06A, 1.06AA, 1.06B, 1.06C, 1.07, 1.09, 1.09-2,
122-1 1.09-3, 1.09-5, 1.10A, 1.10B, 1.10E, 1.11A, 1.14-1, 1.14-1A,
122-2 1.19-1, 1.23, 1.24, 1.24B, 1.24C, 1.24D, 1.25, 1.25A, 1.27, 1.30,
122-3 1.33, 1.33A, 1.33B, 1.33C, 1.35C, 1.40, 1.41, 3.90, 5.121, 21.20-1,
122-4 21.30, 21.51, 21.69, 21.79B, and 21.79C, Insurance Code, are
122-5 repealed.
122-6 SECTION 6. LEGISLATIVE INTENT. This Act is enacted under
122-7 Section 43, Article III, Texas Constitution. This Act is intended
122-8 as a recodification only, and no substantive change in law is
122-9 intended by this Act.
122-10 SECTION 7. EFFECTIVE DATE. This Act takes effect September
122-11 1, 1999.
122-12 SECTION 8. EMERGENCY. The importance of this legislation
122-13 and the crowded condition of the calendars in both houses create an
122-14 emergency and an imperative public necessity that the
122-15 constitutional rule requiring bills to be read on three several
122-16 days in each house be suspended, and this rule is hereby suspended.